Tax, payroll and business
Equipment financing
Compare buying with cash, borrowing and leasing over the same period, including final ownership.
Before sales tax and income tax · CAD
Your equipment
Cash purchase · recurring costs
Loan · down payment, rate and term
After maturity: equipment retained, loan repaid, recurring costs continue.
Lease · payments and ownership
The lease renews at the entered payment after its initial term. It closes at the horizon: the deposit is fully refunded, closing charges are paid and buying is optional. If the horizon precedes lease maturity, include all termination charges and remaining rent due in closing charges. Resale value is deducted only when you own the equipment.
Compare three options
Same horizon: 36 months · amounts displayed in whole dollars
| Comparison | Cash | Loan | Lease |
|---|---|---|---|
| Nominal net cost after resale | $10,800 | $11,942 | $12,600 |
| Initial outlay | $12,000 | $0 | $500 |
| Initial monthly payment excluding recurring costs | $0 | $365 | $300 |
| Monthly recurring costs | $50 | $50 | $50 |
| Interest paid | $0 | $1,142 | $0 |
| Cumulative outlays including settlement | $13,800 | $14,942 | $13,100 |
| Balance / balloon at maturity or horizon, closing and purchase | $0 | $0 | $0 |
| Deposit refunded | $0 | $0 | $500 |
| Resale value deducted | $3,000 | $3,000 | $0 |
| Final ownership | Yes | Yes | No |
Nominal cost without discounting. Sales tax, tax recovery, depreciation, deductions and tax savings excluded. Resale is an assumption; also compare cash requirements. No automatic recommendation.
Method and assumptions
Payments occur at month end. The annual nominal loan rate is divided by 12; interest and payments are rounded to cents. The last instalment is adjusted. The balloon is paid at maturity; a shorter horizon settles the outstanding loan at that horizon, without penalties. After repayment, you retain the equipment and recurring costs continue.
The lease renews at the entered payment after its initial term. It closes at the horizon: the deposit is fully refunded, closing charges are paid and buying is optional. If the horizon precedes lease maturity, include all termination charges and remaining rent due in closing charges. Resale value is deducted only when you own the equipment.
Nominal cost without discounting. Sales tax, tax recovery, depreciation, deductions and tax savings excluded. Resale is an assumption; also compare cash requirements. No automatic recommendation.
BDC · Buying or leasing equipment