REVIEW OF THE MONTH: FINANCIAL LEASE, AN ALTERNATIVE TO OBTAIN RESOURCES
In the current situation, the need to obtain financial resources in companies is a priority to continue activities that generate wealth, employment and payment of contributions, an alternative to obtain said resources is through financial leasing.
Financial leasing is defined in the General Law of Credit Titles and Operations (LGTOC) as follows:
It is the contract by virtue of which the lessor is obliged to acquire certain goods and to grant their use or temporary enjoyment, for a forced term, to the lessee, who may be a natural or legal person, the latter being obliged to pay as consideration, which will be settled in partial payments, as agreed, a determined or determinable amount in money, which covers the acquisition value of the goods, financial charges and other accessories that are stipulated, and adopt at the expiration of the contract any of the terminal options to which Article 410 of the same Law refers, which are listed below:
I. The purchase of the goods at a price lower than their acquisition value, which will be set in the contract. In the event that it has not been set, the price must be lower than the market value on the date of purchase, in accordance with the bases established in the contract;
II. To extend the term to continue with the temporary use or enjoyment, paying an income lower than the periodic payments that it had been making, in accordance with the bases established in the contract; and
III. To participate with the lessor in the price of the sale of the goods to a third party, in the proportions and terms that are agreed in the contract. “
As can be seen, this contract allows the property to be acquired at its conclusion, to continue with the use or temporary enjoyment or to sell it to a third party and obtain a share for said sale. It should not be confused with the pure lease contract, since the financial lease establishes within its clauses: the value of the good object of the contract, an interest rate and some of the options allowed at the end of the contract.
From the previous analysis, certain alternatives can be found to use this figure:
If the company has some fixed assets that it owns, it can obtain financial resources by selling them to a financial company to later continue with their use or enjoyment by entering into a financial lease.
Likewise, if the company requires to invest in some fixed assets that are necessary in its business activities, it can avoid the financial outlay that this implies, indicating to the financial lessor the assets that it requires for it to acquire them and subsequently grant it the use and enjoyment thereof. The company that uses and enjoys the assets during the term of the contract, will make partial payments periodically until they cover their acquisition value, as well as the corresponding interest.
It is important to note that the Income Tax Law (LISR) allows landlords to consider as deductions for the purposes of calculating Income Tax (ISR) and employee profit sharing (PTU), the investment made through the financial lease and the interest accrued during the term of the contract.
As noted in previous paragraphs, at the end of the contract there are three alternatives and, it is recommended to opt for the sale of the good to a third party at the price that had been agreed in the same contract.
The third party that acquires the good at the end of the contract, may be the person designated by the lessee, and will be the one who will pay the price previously agreed in said contract plus the corresponding value added tax (VAT).
The sale of the property to a third party at the end of the contract allows 100% of the investment value to be deducted within the term of the contract, and the participation obtained from the sale of the property must be considered as accumulative income, for the purposes of income tax and of the PTU. Likewise, the sale of the asset to a third party makes it easier for the company to maintain a policy of renovating its fixed assets and, consequently, avoid their obsolescence.
In summary, the financial leasing contract is a financing alternative for companies, which allows them to reduce the income tax by up to 30% (or 20% in the border area) and the PTU by 10% of the value of the good object of the contract and accrued interest, reducing the net financial cost of the investment made.
Author: Manuel Nevárez Chávez