An Operating Lease is a financial agreement where the asset is treated as an off balance sheet item and Iveco Capital retains ownership of it. Customers selecting this option agree to specific usage parameters for the vehicles at the outset and assuming these do not vary significantly, the monthly payments and interest are fixed for the duration of your contract. The prime advantage of this arrangement is that rentals are significantly lower than under a Finance Lease, because the vehicle’s residual value is included in the transaction. At the end of the agreement you can choose to extend the agreement or simply return the vehicle to us. For Operating Leases of five years or less, we have the legal and tax title to the asset allowing us to make effective use of writing down allowances, which we pass on to you within the rental. In addition, you claim tax relief on the whole rental amount through your profit and loss account. Your cash flow is eased still further because you pay VAT on the monthly repayments, not on the principal purchase cost.

Key Features and Benefits at a glance:

• Monthly rentals reduced, based on guaranteed residual values

• Improved cash flow

• Low initial capital outlay

• No asset ownership risk

• Off balance sheet

• Flexibility to extend the lease term

• Tax efficiency – rentals allowable against the taxable profits

• VAT on the monthly repayments, not on the principal purchase cost
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