Staying within budget is one of the biggest problems schools and educational institutions face when buying new IT equipment. At a time when budgets are being increasingly squeezed, it’s often hard for schools to justify new IT purchases when there are so many other priorities. At Smarter Interactive we can offer schools an operating lease for our interactive white boards, projectors and other IT equipment, to ensure that every child benefits from the latest technology.
What is an operating lease?
An operating lease is basically a long term usage agreement, or a long term rental agreement, for specialist equipment. Rather than buying outright, you purchase an operating lease giving you use of the equipment for a fixed period of time. You never actually own the equipment and you will only pay for a percentage of the original cost – up to 90% of the normal purchase price. At the end of the lease period you either return the equipment or you renew the lease.
There are many benefits to schools when they buy an operating lease rather than buying equipment outright. The main benefit is that leasing improves cash flow. Rather than spending a large amount of money to purchase equipment, schools can pay a small amount each month, spread over a number of years, leaving the cash available for other projects. Operating leases also offer schools an alternative credit line, again leaving resources free for other commitments.
Leasing is also good for your school’s accounts. If you purchase equipment outright you can only claim for them as a capital expense, but when you lease, both the monthly payments and the VAT are tax deductible, so you are effectively able to claim the entire cost of the equipment as a tax allowable expense.
Another benefit of purchasing an operating lease for IT equipment is the flexibility of what the lease covers. As well as the hardware itself your lease can include training, maintenance, installation, software etc. all for one fixed monthly cost. And if you decide to upgrade your equipment mid-lease you can do so, normally without increasing your payments or the lease period.
Finally, forward planning is a lot easier when you lease. Equipment becomes old and needs replacing, and if you own that equipment, you may find it becomes costly to run as it deteriorates or that you have the problem of disposing with it when it expires. When you lease you know when the leasing period finishes and you can plan ahead, either by budgeting to purchase new equipment or by starting a new lease. You also don’t have the worry of disposing of old equipment, as it is returned to the leasing company to dispose of.
To find out more about how an operating lease could help your school improve their technology resources, call us today on 0118 336 0010 or email us.