Broadcast News

Bookmark and Share
24/07/2017

Medialease Specialist Asset Finance

News Image
As specialist financiers to the broadcast and post-production sector, Medialease has been helping companies locate financing options for over twenty years.

The company understands the many requirements of this industry, together with how essential the specialist equipment you need is to the success of your business. When considering whether to rent or buy, it's important to also think about long-term rental or leasing options. These can have their advantages – spreading the cost of acquiring the kit is the obvious one – but importantly you can often claim back the full lease repayment costs as a legitimate trading expense.

Medialease's managing director, Paul Robson, looks at three most common options – hire purchase, finance leasing and medium term equipment rental – discussing the key features and benefits of each:

"Hire Purchase is typically used in the media industry to spread the costs of ownership over the first working life of the equipment, typically three years," Paul Robson explains. "The benefits of Hire Purchase are that you have all the accounting and tax advantages of owning the kit from day one as if you had bought the assets but spread the costs. This means the asset appears on your company’s balance sheet that day but there is a liability to the lease company for the term of the HP agreement, with the interest element charged to your expenses or overheads as a cost. The asset is depreciated in your normal manner. You can also claim Capital Allowances against this asset purchase, as if you had paid for it in cash, which can be advantageous from a corporation tax perceptive if you made decent profits in the year to enable you to claim such Allowances. At the end of the lease period, you simply pay an additional £50 to £100 as an ‘option to purchase’ and the kit is now all yours!"

With a Finance Lease agreement, there are mainly similarities, but the main difference is the way the Lease agreement is treated within the accounts. Paul continues, "Just as an example, if your monthly payment is £2,000, then the whole payment amount every month is treated as a business expense and shown in your accounts as such. So, at the end of the year when you have spent £24,000 in lease payments, that reduces your profits by this amount and thus any corporation tax liability is reduced as a result. Importantly, as it's not your asset to claim (yet), you can't claim any Capital Allowances on the purchase value of this asset since it was purchased by the lease company not yourself. Some funders can make it awkward for you to gain title to the asset at the end of the lease period but these days most are fair and may only seek one further payment or less to give you title to the asset after all payments have been met."

Another option when looking to finance equipment is to look at medium to long-term rental.
"Again, this is a finance company providing the funding to you but, similar to finance leasing, you are renting the kit, so all the leasing conditions still apply," Paul explains. "However, your rental payments are somewhat lower than with a finance lease since there is no ownership – the funder has placed a future residual value (“RV”) on what the equipment will be worth at the end of the term, and that is the amount they are owed and will need to recover from the asset sale at the end of the primary lease period with you. This is typically either by taking it back and selling it, or renting it to you for a further 12 -24 months, after which time you may be offered the purchase option for a modest sum. The funder can also rent it on to someone else if you are not interested in retaining the asset further beyond your primary lease term.

"With this form of financing, you normally find the monthly repayments are the lowest of the three options I've talked about. Medialease can of course advice its customers accordingly, offering dependable leasing information whatever a company's size and whatever asset classification they are looking to invest in."

Medialease enjoys close relationships with many major equipment suppliers and manufacturers, giving the company access to knowledge, new products and fantastic deals that you won’t find anywhere else. If you need some specific advice on leasing – confidential or otherwise – please contact the team at Medialease on 01327 872531 or visit www.medialease.com
Solidmate Ltd Memory Card Hire London

Top Related Stories
Click here for the latest broadcast news stories.

14/09/2017
These Filmmakers Are Earning Money By Renting Out Their Own Equipment
What Is Fat Lama and How Does It Work? Fat Lama is a peer to peer rental marketplace for your stuff. Whether you've got a gimbal which you only use oc
28/06/2017
ETL Systems Provides RF Equipment For UHD Production Truck
ETL Systems has helped Timeline Television build its first UHD production/uplink truck – designated "RF1" – for use with major UK broadcasters. To mee
19/11/2021
Medialease Appoints New Team Members
Medialease has further grown their team by welcoming three new team members. Medialease has been providing specialist asset finance for the live event
13/06/2017
PWS Unveils New Equipment At InfoComm 2017
Professional Wireless Systems (PWS) is to introduce its new equipment and rental packages at InfoComm 2017, Booth 6881, 14 – 15 June. On display will
25/05/2017
HHB Supplies Equipment For New Studios At Abbey Road
London studio complex Abbey Road Studios has built a complete Dolby Atmos Premier Studio-certified sound post-production facility with equipment suppl
14/12/2018
Lawo Equipment Installed In Philharmonie Production Complex
LAwo equipment has been installed in the Philharmonie Production Complex of Cologne-based German public broadcaster Westdeutscher Rundfunk (WDR). The
29/11/2018
Finepoint Broadcast Announces Strong Sales In Broadcast Equipment
Finepoint Broadcast Ltd has announced strong sales both of new and pre-owned broadcast equipment throughout 2018 with accelerating demand for cameras,
09/11/2018
Bloch Relies On Wisycom's Wireless RF Equipment
Production Sound Mixer/Boom Operator Adam Bloch was recently tasked with capturing all the hard-hitting, in-your-face audio for a behind-the-scenes lo
28/03/2017
Three More Companies Join AIMS
Three more companies have joined the Alliance for IP Media Solutions (AIMS). They are Bridge Technologies, Clear-Com, and Solid State Logic. Bridge Te
03/09/2021
Televisa Selects ETL Systems' RF Distribution Equipment
Televisa, one of the leading media companies in Latin America and the operator of a direct-to-home satellite pay television system in Mexico, has chos
16/08/2021
Pine Crest School Deploys Equipment From JVC Professional Video
As a premier provider of private education in Boca Raton and Fort Lauderdale, Florida, Pine Crest School prides itself on its superior curriculum bala
20/10/2021
Creative Vision Finance: New Approach To Industry Finance
Creative Vision Finance (CVF) is an innovative new Media and Entertainment asset financing company that offers a fresh approach to lending for industr
01/02/2022
Rihm Family Companies Takes Carousel Digital Signage Network to the Cloud
Celebrating its 90th year in business, Rihm Family Companies operates seven Kenworth truck dealerships in Minnesota and Wisconsin that represent the p
05/01/2018
CABSAT 2018: UK Companies To Exhibit
More than 50 British companies will collectively exhibit at CABSAT 2018 from 14 – 16 January at the Dubai World Trade Centre. Some 25 companies will e
13/12/2019
Medialease Wins 'Asset Finance Intermediary' At Leasing Life Awards
Medialease has won best 'Asset Finance Intermediary' at the Leasing Life 2019 awards, which brings together the most successful and innovative busines