01244 525410 inbound@ldf.co.uk www.ldf.co.uk EQUIPMENT FINANCE SOLUTIONS LDF Operations Limited (reg no. 02029122) part of the LDF Group is authorised and regulated by the Financial Conduct Authority for credit-related business (including hiring).
CONTENTS Equipment Finance Solutions 2 Our Finance Products 3 LDF have a strong history in providing finance and leasing solutions to the sector whether directly to businesses or via equipment manufacturers and resellers with whom we partner. Choosing The Right Type Of Finance Benefits Of Financing Equipment 4 5 Why Choose LDF? 6 Asset Finance: Frequently Asked Questions 8 Contact Us 12
EQUIPMENT FINANCE SOLUTIONS Financing equipment is ever increasing and in demand. Typically the business critical assets are rapidly depreciating; therefore many businesses will seek to spread the cost of acquisition over the expected life of the asset via leasing. Preserving capital for operational costs, purchasing stock, identifying new products and business opportunities that may arise are key drivers of business growth, making the benefits of finance clear. LDF have a strong history in providing finance and leasing solutions whether directly to businesses or via equipment manufacturers and resellers with whom we partner. Equipment Financed includes: 1 Air Conditioning Furniture, Fixtures & Fittings Amusement & Gaming Gym Equipment Audio Visual Information Technology Barware Laundry Beauty Equipment Lighting Beverage Refrigeration Refurbishments Buffet Display Security Systems Cooking Soft Play Epos & Cash Handling Software Fabrication & Storage Telecommunications Food Handling Vending Food Preparation Warewashing Food Service Waste Management 2
OUR FINANCE PRODUCTS CHOOSING THE RIGHT TYPE OF FINANCE At LDF we aim to make finance easy for our customers. We take a commercial approach to business finance and can provide solutions for a broad number of requirements. We pride ourselves on our ability to enable businesses to grow and acquire the assets they need both quickly and easily. Asset finance is a form of finance that enables you to obtain a wide range of equipment necessary to operate efficiently and effectively within your sector. Wholly or largely secured on the assets being financed, the need for large deposits is significantly reduced and also gives you the flexibility to replace or upgrade equipment at any time. Making the right decision on which finance product you choose to use for asset purchase is incredibly important. We always recommend that businesses seek to discuss their expenditure plans with an accountant or other relevant adviser. We have produced a simple guide providing some clarity around each product s salient features. Frequently asked questions Finance Lease Hire Purchase Commercial Loan FINANCE LEASE HIRE PURCHASE Equipment leasing transfers substantially all the rights and obligations of ownership to you and can be for any length of time up to a maximum of five years. During the life of the agreement the full value of the equipment appears on your balance sheet as an asset and liability, and an element of the rental treated as a business expense and passed through the profit and loss account. You are responsible for maintaining and insuring the asset during the life of the agreement. Hire Purchase enables you to acquire the equipment you need by LDF purchasing the equipment on your behalf. We maintain ownership of the asset until the final payment is made and at this point you have the option to purchase the asset for a nominal sum. During the life of the agreement the full value of the asset appears on your balance sheet as an asset and liability, an element of the rental treated as a business expense and passed through the profit and loss account. Will I be able to own the asset? Potentially Yes Yes Are rentals tax deductible? Interest Only Interest Only Interest Only Can I claim Capital or Annual Investments Allowance? No Yes Yes Does this route preserve capital? Yes Yes Yes Can I have a fixed term agreement? Yes Yes Yes Can the term be extended? No No No Will the agreement be made on demand by LDF? Potentially Potentially Potentially Do I need to pay the VAT Upfront? No Yes N/A Is the asset off balance sheet? No No No Can VAT on payments be reclaimed? Yes No N/A Do I have to insure the assets under the agreement? Can VAT on the cost of the asset be reclaimed? Will I need to pay a facility or arrangement fee? Yes Yes No No Yes Yes Yes Yes Yes COMMERCIAL LOAN We understand that many SME businesses may struggle to access relevant finance, especially when considering options for business development and growth. To support these opportunities, LDF s commercial loan is tailored to meet these requirements with terms from 3 to 12 months. Remember: Where VAT is classified as reclaimable assumes your business is VAT registered The tax and VAT treatment may differ dependent upon the asset finance products Facilities can be made on demand in accordance with the terms and conditions of the agreement Please seek specialist advice on VAT and tax relating to your business Please note that security may be required and product fees may apply. 3 4
WHY CHOOSE LDF? BENEFITS OF FINANCING EQUIPMENT When you choose to finance through LDF, you will enjoy many valuable benefits. EXPERIENCE We ve been helping businesses to grow through finance for over 30 years. As the UKs largest independent provider of SME finance solutions, we are committed to delivering excellence to our customers, be that through our high levels of service, our technology led approach or the fact that as both a funder and a broker, we are able to deliver the most appropriate funding solutions available to us. Flexible Payment terms and profiles can be tailored to meet cash flow Allows for equipment upgrades Can include hardware, software, training, installation and support services Easier Budgeting Makes budgeting and forecasting easy with fixed payments You re not subject to fluctuations in interest rates The real cost of acquisition reduces as inflation rises We re very proud of our 4.9 star rating, reflecting our commitment to service and customer satisfaction. As specialists in asset finance our aim is to maintain consistently high levels of service for our customers and partners through technology and a personable approach. EXCELLENCE IN SERVICE Independent Service Rating Tax Efficient Leasing is Tax deductible, reducing the net cost of obtaining the equipment * Maximise Budget Acquire the desired solution through payments; make your budget work harder Conserve Working Capital Helps to reduce initial cost outlay Allows your capital to be invested in other efficient growth areas Convenient Easily manages supplier(s) payment terms and administration requirements Payments are made by Direct Debit removing the need to settle invoices MODERN FUNDING We aim to provide our customers with access to competitive funding solutions by using our own book lending and constantly reviewing pricing to ensure we remain competitive. As a funder we hold a unique approach to underwriting, our focus is to provide finance for all credits through our three tiered funding model that helps us to achieve market leading acceptance rates. * For further information surrounding taxation, please consult your Accountant 5 6
ASSET FINANCE: FREQUENTLY ASKED QUESTIONS What finance options are available? The most popular asset finance products for SMEs are Finance Lease and Hire Purchase agreements, both are similar in nature however enable different tax incentives to be maximised based on asset ownership. How flexible can asset finance be? Any of our finance solutions can be tailored to meet multiple supplier purchases and payment terms, also on case by case basis repayments can be structured to meet seasonal trading by adjusting repayment amounts. To summarise, our finance can be tailored to your needs - we just need to understand what these are and why. What can asset finance be used for? Suitable for a large selection of asset types, finance is available on purchases from 1,000 to several million pounds in value, covering anything from IT Hardware & Software, Lighting, Catering, and Plant & Machinery Equipment through to installation, support, maintenance and training. Put simply, if it s integral to the running or operation of a business, there is a solution that fits. Why would I not use cash? Capital is a valuable asset itself in a business. By using asset finance, you can acquire the assets you need, achieve potential tax incentives and have little impact on cash flow as well as accelerating the return on investment quickly. Why not hold onto your valuable capital and invest it in other areas of growth (such as acquisitions, increasing sales heads, training etc.) that will not benefit from the same incentives. 7 8
Isn t my bank the best source of finance? Whilst bank finance plays an important role in business growth, access to finance remains an area of difficulty for some businesses. Additionally, the variety of available facilities may not always match that of a corporate finance company. With businesses looking for rapid and often alternative solutions to business investment, many will now look to facilities provided outside of traditional banking options. Does business trading performance limit options to finance? We pride ourselves on providing access to finance for all business stages and performance, whether a new start, well established, or small or large company. If I use asset finance, do I need to insure the assets? Yes; as soon as you take delivery of the assets you are obliged under the terms of the agreement to insure it against loss or damage. With all our agreements you will be asked to provide details of your insurance policy and should you not have insurance this will be set up for you by our nominated third party insurance provider who will contact you by post. Will we need to provide additional security? An element of comfort is taken in the asset dependent upon the depreciation levels the asset holds against the lifetime of the agreement. Alongside this, we may ask for a guarantee if the amount of borrowing is considerable and your balance sheet is developing or growing. We do take an element of security in the asset, but we primarily review the credit history of your business and its financial performance. However, ultimately our aim is to provide finance by simply matching the risk vs. return on capital, this way we hold excellent acceptance rates and help more and more businesses to grow rather than turning them away. How long does it take to arrange asset finance? The main driving factor behind this is the amount of finance being applied for; typically asset finance of below 50,000.00 will take less than 24 working hours for a credit decision often much sooner. Our internal systems and supplier platforms enable our processing to be incredibly efficient. If all parties are fully aligned, it is possible to complete a full transaction from proposal to signed documents and pay-out within one working day. Can I make changes to my agreement during the term? Yes; being flexible is one of the key benefits of asset finance as we understand that you may wish to upgrade your assets or add additional assets to your business. Typically we allow for upgrades or additional assets to be added to a new agreement when 50% of the original agreement term has passed or where system mandatory upgrades are needed, please note, however that upgrades are subject to credit and underwriting. How can I discuss finance or obtain a quotation? You can very quickly obtain information about how asset finance can help you by speaking with your supplier with whom we partner. They can provide you with a quotation via access to our mobile quotation and finance proposal app. Alternatively, you can learn more about our facilities and contact us via our website on www.ldf.co.uk. 9 10
CONTACT US We re very proud of our 4.9 star rating, reflecting our commitment to service and customer satisfaction. www.ldf.co.uk 01244 525410 inbound@ldf.co.uk 11 12