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Why lease phone boxes?

What are the advantages of purchasing a leased sound booth? For whom is it beneficial? We explain everything in this article!

By Estelle Josse
Why lease phone boxes?

The market for phone boxes is growing rapidly and they are becoming an essential part of the best open spaces. Many people are interested in them, but the price and the investment they represent can put some people off. Indeed, for quality phone boxes you have to be prepared to spend a certain amount of money. (To find out how to choose a quality phone box we recommend our article on the subject).

Leasing can be an interesting solution for companies that do not want to spend money on acoustic meeting roomsdirectly.

What is leasing?

Leasing is a rental solution that allows any consumer to benefit from an asset in return for monthly payments.

The amount of the leasing rent is considered an expense. Unlike a direct purchase, which is similar to a fixed asset depreciated over the estimated life of the asset. They are not translated in the same way in accounting/taxation and this is the strength of leasing!

The advantages of leasing

At the balance sheet level

The biggest advantage of leasing is of course the cash flow. You can easily dispose of an acoustic cabin without any contribution. This action is considered a rental for the company.

It does not appear in the company's active accounting balance sheet and has no impact on cash flow. This preserves investment and debt capacity. Thus leasing does not affect the apparent solvency and allows the borrowing capacity to be maintained.

In terms of taxation

Lease payments from a leasing transaction are classified as operating expenses in the income statement. This reduces the taxable profit and therefore the amount of tax to be paid.

The shorter the rental period, the greater the tax advantage. As the amounts to be repaid are higher, the reduction in taxable profit will be all the greater.

At the VAT level

The company does not have to pay the entire VAT at the beginning of the contract: the bank takes charge of the entire amount at the time of purchase, and the VAT is then spread over the various rentals throughout the contract. This distribution avoids advancing the VAT, and thus an excessive expense when purchasing your phone box.

In terms of freedom to buy

Leasing is a rental with a purchase option. The company has the option to buy it at the end of the contract but is not obliged to do so. It can choose to return the phone box, or enter into an agreement with the company to purchase the asset.

Having this choice is less restrictive, you can choose the most suitable solution according to your accounting and needs at the end of the contract.

You also have the possibility to renew your leasing contract with a new phone box. This means that you can renew your contract for 24, 36 or 48 months, during which time you rent a new phone box. 

The advantages of leasing at Leet design

A unique guarantee

Leet design guarantees its acoustic booths for the entire duration of the leasing contract. This means that we are committed to dealing with any after-sales service request in a timely manner.

Quality phone boxes at an affordable price

With its choice of materials and the service it provides, leet design is one of the most elegant manufacturers of acoustic booths. Thanks to the leasing solution, you can equip yourself with our acoustic cabins at a lower price.

The limits of leasing

The conditions

Of course, there are some conditions for buying with a leasing agreement. Since the bank is buying the asset for you, it is normal that it requires some conditions.

Your company must be 1 to 2 years old and your balance sheets must be positive.

If you are a startup don't panic! Banks are lenient on startups that have raised funds, as long as they provide proof of their fundraising!

Why buy when you can choose a leasing option? 

Fixed assets can also have advantages. Indeed, you can benefit from depreciation and thus reduce your taxable profit. It is especially the declining balance depreciation that will be interesting (this option is not applicable to second-hand phone boxes).

With degressive depreciation, the amount of deductible annual instalments decreases over time.

It is particularly suitable for growing companies, which are interested in this increased tax advantage at the beginning of their development, when they need financing the most. As they grow, the need to reduce their taxation may become less pressing.

In short, you should choose a purchase solution that suits your needs and your financial situation. You will always find an advantage. However, we recommend that you take advantage of the leasing solution to provide your employees with quality phone boxes. Phone booths will contribute to the productivity of your employees and therefore to the growth of your company, so don't deprive yourself of them because of the price!

Now you have no excuse not to buy an acoustic booth!

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