Maximising Your Tax Position with Equipment Finance

Equipment finance allows businesses to acquire essential assets without paying the full cost up front. Instead of tying up working capital in a large purchase, you can spread the cost over an agreed term while preserving cash flow for day-to-day operations and growth.

Unlike an unsecured business loan, equipment finance is usually secured against the asset being financed. This can make it a more flexible and cost-effective option for businesses investing in machinery, vehicles, technology, specialist equipment and other revenue-generating assets.

If you’re expanding capacity, replacing ageing equipment, or investing in new technology, equipment finance can help you access the assets your business needs while maintaining financial flexibility.

Is Equipment Finance Right for Your Business?

Equipment finance is often an excellent solution for established businesses looking to acquire valuable assets without making a significant upfront capital investment.

As a specialist broker with access to more than 35 lenders, we can match businesses with funding partners whose criteria align with their circumstances. Different lenders have different appetites for sectors, asset types, deal sizes, and credit profiles, creating more opportunities than approaching a single lender directly.

Our core strength lies in supporting established SMEs that are making strategic investments in business-critical equipment. Our team can help identify the most appropriate funding solution, whether you’re purchasing manufacturing machinery, healthcare technology, commercial vehicles, or specialist engineering equipment.

See if you qualify for equipment finance 

Speak to our team to discuss your funding requirements and explore your options

Types of Equipment Finance

Equipment finance is an umbrella term for several different funding products. The right option depends on whether you want to own the asset, how long you expect to use it, and your wider financial objectives.

Hire Purchase

Hire purchase is one of the most popular forms of equipment finance. You pay an initial deposit followed by fixed monthly payments over an agreed term. Once all payments have been made, ownership transfers to your business.

Hire purchase is often best suited to businesses that want to own the asset outright while spreading the cost over time. It is particularly popular for machinery, vehicles, and equipment with a long useful life.

Explore our Hire Purchase Solutions

Finance Lease

With a finance lease, you gain use of the equipment while ownership remains with the finance provider. Monthly rentals are paid throughout the agreement, and the asset remains available for business use.

This option is often suitable for businesses that require long-term use of equipment but do not necessarily need ownership.

Explore our Finance Lease Solutions

Operating Lease

An operating lease allows businesses to use equipment for a defined period before returning it at the end of the agreement. This can be particularly attractive for assets that become outdated quickly or where flexibility is important.

Explore our Equipment Leasing Solutions

Equipment Loan

An equipment loan provides funding to purchase equipment directly. Your business owns the asset from the outset and repays the loan over an agreed term.

For many asset-backed purchases, however, hire purchase may provide a more tailored funding structure.

Equipment Finance and Tax

For many businesses, the funding structure is only part of the decision. The tax treatment of equipment purchases can also have a significant impact on overall value.

Businesses purchasing qualifying plant and machinery through hire purchase may be able to claim capital allowances, including full expensing and the Annual Investment Allowance (AIA), subject to current legislation and eligibility.

What is Full Expensing?

Full expensing allows companies to claim 100% first-year tax relief on qualifying expenditure on eligible plant and machinery. This means the entire cost of a qualifying asset can potentially be deducted from taxable profits in the year the expenditure is incurred. For businesses making substantial investments, this can create a significant tax advantage.

Equipment We Finance

Equipment finance can support investment across a wide range of sectors and asset categories.

Examples of equipment we finance include:

• Manufacturing machinery
• Agricultural equipment
• Construction equipment
• Healthcare and dental equipment
• Commercial vehicles
• Catering and hospitality equipment
• Engineering machinery
• Printing equipment
• IT infrastructure and technology
• Renewable energy and solar equipment
• Professional services equipment
• Warehouse and logistics assets

As lender appetite varies by sector and asset type, working with a specialist broker can help identify lenders with experience in your market.

Whether you require construction equipment financing, healthcare equipment finance, engineering equipment finance, or specialist sector funding, Star Asset Finance can help source appropriate solutions.

FAQs About Equipment Finance

What is the difference between equipment finance and a bank loan?

Equipment finance is specifically designed for asset purchases and is usually secured against the asset itself. A bank loan is generally unsecured or secured separately and can be used for a wider range of purposes.

Can I claim capital allowances on financed equipment?

It depends! In many cases, qualifying assets acquired through hire purchase may be eligible for capital allowances, including full expensing and the Annual Investment Allowance. You should always seek professional tax advice.

How much deposit do I need?

Deposit requirements vary depending on the lender, asset type, and overall transaction. Most agreements will require a deposit, but others may offer alternative structures.