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The Benefits of Leasing Art
Leasing our art converts a large capital of expenditure into small monthly payments and keeps your cash reserve available.
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Lease Rental is 100% Tax Deductible
The main reason that the majority of companies lease rather than purchase art is that they use leasing as a method of reducing their tax bills. This is because lease rental is 100% tax deductible, meaning that all payments you make for your artwork are written off against your tax bill. For any profit making business, this means a substantial saving in real cost of acquiring art by lease rental. This could save you 20% on your lease payments, based on UK corporation tax rates.
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Leasing is often referred to as ‘off balance sheet’ financing – a tremendous advantage to both large and small businesses.
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Tax Advantages of Leasing
Outright Purchase - £10,000.00
Lease - based on 12 monthly Payments of £833.33
Tax relief £2000
Cost after tax relief £8000
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** A Saving of £2000 against the cash purchase price **
*** Flexible monthly rental periods to suit your budget ***.
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As you can see by the example above the lease can have considerable advantages so long as you are in profit.
The tax relief can actually reduce the overall cost and you do not have to endanger your liquid cash flow purchasing new art when you can invest in stock and increase your profits.
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At the end of your lease
During the lease period (normally 1-2 years) you are renting the art and for that reason you are gaining your 100% tax relief. At the end of the period therefore the art is not your property, which means in theory you should return it to The Global Art Company, however in practice no one does this.
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The Global Art Company sell you the art for one further monthly payment, which of course is still 100% tax deductible. Alternatively why not take advantage of our refurbishment offer? If you have other properties we can refresh the existing artwork and install into a second premises for free if a new rental agreement is taken out.
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