Investing in any asset for your office requires consideration of all pros and cons. Should you buy or rent your printer? Here is a list of the benefits of both options, choose the one that best fits your situation.
BENEFITS OF RENTING
Lower initial costs and better cash flow
Especially start-up companies that are unsure about their printing and copying requirements long-term, or companies needing highly specialised equipment, will benefit by renting a printer or copier, as there are fewer upfront costs. The initial expense of buying the essential printer or copier could be very high.
Maintenance plans will always accompany the rental option, therefore the hirer will never have any hassles to deal with equipment malfunctions. When equipment has served its purpose and needs to be re-sold, the burden of seeking buyers falls onto the supplier.
No replacement costs
When an office copier or printer has become outdated or is starting to malfunction, then it will need to be replaced. Fortunately, for those renting a copier or printer, the unexpected replacement costs will be absorbed by the supplier and not the hirer. However, rent from Diverso, as we do not charge heavy penalties when printing equipment needs upgrading, and we do not have automatic renewal clauses.
Monthly tax benefit
The full monthly rental payment qualifies as an expense that will lower taxable income, and you can claim the input VAT.
By renting equipment, you will have more cash flow to add and upgrade technology at your own pace.
BENEFITS OF BUYING
Long-term savings, “sweat the asset”
While there is no doubt that buying a printer or copier is expensive, the rental option does cost more in the long run. The lessee is required to pay interest monthly on the rental, eventually having paid more in the long-run than the initial buy value of the printer or copier.
No contract stipulations
Very flexible options are available when copier or printing requirements change, as opposed to having a contractual rental term. With an upfront purchase, there are no additional payments and the copier or printer can be sold when necessary.
With a rental agreement, the option to terminate the contract if the copier or printer requirements change exists, but can come with penalties. If you buy the equipment, these potential penalties are avoided.
The buyer will own the equipment, whereas this is usually not an option when you rent the equipment.
Tax benefit on depreciation
As the company now owns an asset, the asset can be depreciated that will lower taxable income.
This newsletter is a general information sheet and should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Errors and omissions excepted (E&OE).