What is Leasing?
Do you need to make an investment to grow your business? You don't have to spend your working capital to purchase movables and real estates. With leasing, a mid- and long-term financing method, you can make your investments by renting instead of purchasing, and use your resources more efficiently and profitably.
According to Leasing, Factoring and Financing Companies Law No. 6361, leasing is applied in two ways in Turkey:
- The invested item is purchased by the leasing company and provided to the use of the lessee against rental payments.
- At the end of the contract term, the ownership of the item is transferred to the lessee at a symbolic rate.
- The lessee may only register the delay interest as expense, not the entire rental amounts.
- The lessee shall allocate amortization over invested item use right.
- Ownership of the invested item remains at the leasing company.
- The lessee leases the invested item for relatively short-terms (less than 80% of the economic life).
- The value of the total rental amount reduced to today cannot be more than 90% of the sales value of the item.
- The item is returned to the leasing company at maturity date.
- The lessee may register the entire rental amounts as expense.