What is leasing in simple words?

At present, our speech usage includesmany foreign words: leasing, marketing, coaching and many others. And this is normal. What is leasing (formed from the English word to lease, which translates as "rent") in simple words? We will try to explain to those who are interested in this issue. In short, leasing is renting housing, equipment or vehicles with the possibility of buying it out in the future. That is, it is such a financial tool that perfectly combines two possibilities - both long-term lease and purchase. For more details about all aspects of this issue, see the article.

Essence

Do not know what a leasing is? Everything is very simple.The leasing company, having acquired from the seller certain property (for example, real estate, equipment or vehicles), transfers it for a long period in use to the consumer (that is, the third person in this chain).

Important! It is the customer (that is, the consumer of the financial service) who chooses the seller.

During the whole term of the leasingthe client (or lessee) continuously and systematically makes payments, in no way bypassing them (otherwise it can remain without goods). If by the end of the contract the consumer fully pays the cost of what he rents; as well as a certain amount of money (which was stipulated earlier and fixed in the document) to the leasing company for the opportunity to operate it, then the property becomes the property of the lessee legally.

Such a financial instrument is extremelyis beneficial to small firms. At leasing the initial payment for the possibility of using the leased property is about 20-30% of its total cost. And the organization, engaged in leasing, takes a part of the costs for itself. After 5 years (this is the period most often concluded by contracts), this small company becomes the sole and full owner of the property leased to them.

Than leasing differs from a simple lease

What is a lease?You temporarily for a certain amount specified in the contract, use some property belonging to the lessor. Payments are made every month, but are exempt from the down payment. At the end of the lease, you simply return the subject of the lease to its owner and that's it.

And what is leasing, in this case? This is also a kind of lease, only with the right to purchase the property or its phased acquisition in full ownership.

Important! First, leasing without an initial payment is impossible. Secondly, the lessee can become a full owner of the leased property only after it is fully repurchased.

Than leasing is different from a loan

And in the case of leasing, and in the case of a loan, toto receive property for use, the consumer must make regular payments, previously stipulated and fixed in the document, which in the end will cover the full value of the subject of the contract. This is what unites them. But there are also differences:

• Buying this or that property on credit,the borrower immediately becomes an owner overnight. When leasing during the whole term of the agreement, the object continues to be owned by the lessor and can change the owner only after a certain period of time.
• In the case of a leasing transaction, a security is not needed.The credit can not boast of this. In addition, a long installment during leasing significantly reduces the amount of payments and thereby gives the user the opportunity to manage the assets of his firm in the best possible way.

• The credit organization gives the borrower money foracquisition of certain property. The lessor himself acquires the object of leasing and transfers it for use to the consumer with the right of subsequent repayment.
• Expenses for maintenance and maintenance of the itemlending is completely borne by the borrower. In the case of leasing, all such activities can be taken on the "shoulders" by the lessor. And maybe not to take it as an agreement.
• The package of documents for issuing a loan is much larger than in the case of leasing. Yes, and the amount of the down payment is much higher.
• The interest rate on the loan and the total value of the property (in comparison with the real price) is much higher than under the leasing transaction.

On a note! The total value of the leased asset is made up of the real price and the cost of maintenance.

Types of leasing

Depending on what actions the leasing transaction ends, two types are distinguished:

• Финансовый.The essence of this kind is that the consumer undertakes to redeem it at a certain price specified in the contract at the end of the lease term of the leased asset. That is, to become his full and sole owner. As a rule, property costs the lessee at a residual price, which is obtained as a result of deduction of the already paid lease payments from the total cost.
• Operational.In this case, it is understood that the lessee is paying not the subject matter of the lease itself, but only his lease. After the contract expires, the property is returned to the lessor.

There are three types of financial leasing:

• Partial. In this case, it is the lessee who pays all the costs associated with servicing the leased property.
• Full. In this case, the lessor incurs all costs associated with servicing the leased object of leasing.
• International (the contract is concluded by companies from Russia and other countries) or internal (only Russian enterprises are parties to the leasing deal).

For individuals

А что собой представляет лизинг для физических persons? In short, this is a financial lease, in which the individual can use either the right of redemption, or the phased acquisition of the property in the property. And if in more detail, it looks like this:

• Any citizen of our country who failedto accumulate the necessary amount for the purchase of real estate, and also which is denied crediting (or he does not want to do it), he can simply apply to the leasing company with an application for leasing certain property to him.
• The request of physical persons is considered in the firm and concludedwith him a contract. Under the terms of the agreement, the lessor acquires the property indicated by the lessee, and then transfers the object to the citizen for use at a certain fee and for a specific period.
• At the end of the transaction, an individual can either buy out the leased asset at residual value, or return it to the lessor.

Everything is very simple and affordable.That is, it turns out that leasing for individuals presupposes the entry of any citizen of Russia (if he wishes) into a leasing legal relationship, provided that he observes all the conditions of the contract.

Documents required to apply for a lease for a natural person

List of required documents:

• Identity document, that is, a civil passport and its copy (of all pages without exception).
• Application form completed without errors.
• The second document proving the identity and having available a photo (for example, international passport).
• Help indicating the sources of income (for example, employment contract or a copy of the employment record).
• A document indicating the total amount of income for a certain period (for example, reference 2 NDFL).

On a note!First: in case of leasing relations, the age of the client does not matter. Second: in the case of such a transaction, the risks of the lessor are reduced to zero, since in the case of non-payment, the lessee is simply denied a lease, and the property in any case remains the property of the service provider.

Leasing for legal entity

Leasing for legal entities is nothing more thanlegal relations between a company and a leasing organization that provides equipment, vehicles and objects with the right to redeem them in the future for long-term lease.

This is a very convenient financial instrument thatallows fairly quickly, without diverting the main working capital, to acquire certain property, thereby reducing the tax burden. This factor is decisive when choosing bank lending or leasing.

Necessary documents for registration of the contract for legal entity

When signing the lease agreement in the packagedocuments include copies of the balance for the last five reporting periods (to be more precise, quarters) with a mandatory mark of the Tax Inspectorate, an extract from the Shareholder Register (if it is a joint-stock company), as well as copies of the following documents:

• certificates with exact indication of open company accounts;
• certificates of registration with the tax authority;
• civil passports of managers, chief accountant and all those who have the right to sign documents;
• certificates of state registration.

Advantages of leasing for legal entities

When concluding an agreement with a leasing company, legal entities have a lot of advantages:

• At the same time does not require large financial costs.
• Very often service providers offer good discounts when making a lease.
• There is a rapid renewal of production capacity.
• You can count on the help of service providers in terms of customs clearance of cars in leasing or equipment, as well as their registration.
• A fairly flexible system of agreed payments, which takes into account many features of a business (for example, its seasonality).
• The tax burden is optimized by reducing the taxable base.
• The service provider provides warranty service for cars in leasing, equipment or equipment that is leased.
• Upon expiration of the agreementThe lessee can either return the property to the service provider, or buy out the leased object of leasing, or exchange it for a similar, but only new. That is, the consumer has three options for how to deal with the object.

What is a contract

Any contract establishes the main points of interaction between the parties (in our case it is the lessor and the lessee). This document should include the following points:

• Details of the parties to the transaction and contact numbers.
• Full description of the subject of the transaction.
• The duration of the financial lease with exact dates.
• Payment procedure and payment amount.
• Obligations of the parties, that is, the lessor and the lessee.

• On what conditions upon completion of the transaction will the property be returned or repurchased.
• In which case, the possible termination of the contract.
• Additional conditions that depend on what is specifically leased.
• Penalties.
• Date of signing the contract and the signature (with decoding) of each of the participants.

Important! A signed lease agreement must be registered in the Federal Registration Service.

The subtleties of vehicle design

When making a car on lease, the following points are fundamental:

• Initial (advance) fee.It must be made in the name of the lessor before the transfer of property to the lessee. This should be fixed in the contract. The amount may be about 50% of the value of the leased asset. If the consumer makes a large amount, the tax authorities may reclassify the leasing agreement for the purchase agreement (with installment payments) with all the ensuing consequences.

Important! An offer with zero down payment should alert you. This happens very rarely.

• The term of the financial lease. It can be 1-5 years.
• The order (that is, schedule) of making monthly payments. Their size, as a rule, is about 5-6% of the total price of the vehicle.
• Determination of the residual value of the property. It can be 70-80% of the price of the car.
• Operating costs (i.e.tax, current repair of motor transport, its technical inspection, as well as traffic police fines). All this can be “shouldered” by the lessee. In the event that the lessor pays for these costs, the cost of the service will be added to the total cost of the vehicle.
• Restrictions associated with certain actionsin relation to the leased asset. This refers to the ban on leaving or exporting motor vehicles abroad, without following the procedure of prior approval and registration of the vehicle as an inheritance or pledge.
• Withdrawal of the leased asset.This can happen at any time (of course, during the term of the leasing agreement) if the contractual terms are to some extent violated. Only in this way and nothing else. Yes, car leasing is an uncompromising business.

On a note! In the case of seizure of any proceedings will not. Don't even wait. The vehicle is simply withdrawn. Moreover, the return of already paid amounts is not provided.

• Possible penalties. They may follow in the event of damage to the property of the lessor. And this is true.

Car leasing as a financialtool has been known for a long time. But, oddly enough, they were mostly used by legal entities. According to many experts of the automotive market, now comes the time when individuals begin to enter into leasing relationships. Why not? Moreover, car leasing for individuals carries many advantages.

The subtleties of real estate leasing

This service is just beginning to gain popularity.Although earlier the law did not prohibit the use of real estate as an object of leasing (for example, a cottage outside the city, an apartment, or even non-residential premises). Moreover, the value of the object can reach up to 50 million rubles, and the term of the contract can be about ten years. Currently, the relevance of real estate registration in leasing is attributed to the fact that it became available to natural persons. Life does not stand still.

Banks began to offer people leasing in relation tohousing, the procedure for registration of which is not much different from the standard contract. To understand what real estate leasing is, let's look at the algorithm of actions in such a legal relationship:

• The consumer finds a suitable property.
• The bank, based on the application from the client, acquires housing for its own funds and transfers it to the lessee on a financial lease basis.
• After the expiration of the agreement, the consumer buys property at residual value.

Important!Return of property can be made only in case of financial insolvency of the lessee. In the event of such situations, two contracts are initially concluded with the client: one for the purchase of housing with a deferred payment and the second one, which provides for long-term rental property and its redemption in the future.

Finally

Leasing equipment, vehicles orreal estate, as opposed to bank lending is a fairly effective financial tool to grow your business. With it, you can expand production capacity and introduce new technologies into production. Of course, with such legal relations there is a certain specificity of accounting leasing transactions, which fully depend on the terms of the contract.