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Why Equipment Leasing is Better than Buying?


When you doing a business, it becomes very difficult to understand whether to lease equipment or purchase it. Well, to understand this one need to be aware of the pros and cons of both. It is always good to use the tactic which helps you save money and work effectively. One needs to work smartly and make decisions by keeping various factors in mind. These factors include the type of business you are working in, the duration of the equipment required and the kind of equipment required. Businesses can acquire technology, machinery, computers or any other equipment on lease. The difference here is the factor of ownership. In a lease, you have the possession but not the ownership of the equipment whereas while buying, you have the ownership of the equipment.


Leasing equipment bring flexibility to your business and also is a cost-effective method if used for a shorter period. It is a type of financing where the business runs the equipment rather than purchasing it.


  1. When you’re leasing equipment the down payment is very less. At times, businesses need not make a down payment
  2. The terms and conditions are very flexible
  3. You have the right to test the equipment before making a decision
  4. Businesses need not pay maintenance costs as it is mostly free, and is the duty of the lessor to maintain
  5. All the payments for a lease are tax-deductible
  6. It is very simple to acquire equipment on lease, as compared to purchasing it
  7. You can easily upgrade the tenure after the tenure gets over
  8. Consider leasing if you don’t want to deal with obsolete equipment. Leasing gives you quick and affordable access to the latest equipment and technology.
  9. Even if you do not have good credit or a credit score, leasing can be done easily


  1. It will be expensive if you’re leasing equipment for a longer period
  2. You cannot cut short the lease contract, if done termination fees will be charged
  3. Depreciation will not be deducted from the tax
  4. When you leave the item, you’re not the owner of the item. This builds an extra responsibility on the person to keep it good


Purchasing equipment can be a good option if you have enough cash or credit and are confident that you will use the assets for a long time. The benefits of ownership and tax breaks make purchasing business equipment appealing, but the high initial costs mean that this option is not for everyone.


  1. You become the owner of the business
  2. The lifetime cost of the equipment is cheap
  3. Your business can claim depreciation while filing taxes
  4. Equipment that can be sold is not in use


  1. You need a good credit score and cash in hand.
  2. You cannot test the equipment before purchasing it, any default the lead to chaos
  3. This will increase your liability and impact your credit score negatively
  4. You are liable to maintain and replace all the parts at regular intervals of time
  5. Cannot replace the equipment if it gets outdated


Buying or leasing the equipment depends upon the purpose of the equipment, the growth and profitability, business potential, capital investment and duration of use. If you are using the equipment for a lesser period then it is best to lease it. also, it will help you keep yourself updated with the changing technology. Leasing equipment can avoid additional costs and protect your credit. It is one of the best ways to stay competitive in the market with the best services. Therefore, it is true that leasing equipment will always overshadow buying equipment. Make your choice wisely!

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