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Tata Capital > Blog > Generic > Reasons Why Companies Prefer Leasing Their IT Requirements

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Reasons Why Companies Prefer Leasing Their IT Requirements

Reasons Why Companies Prefer Leasing Their IT Requirements

In 2023, companies are rapidly adopting more flexible work models. They want to make work more efficient with automation tools, cloud-based storage, and compatible IT equipment. They also need to provide in-office and remote employees with a secure infrastructure, which means more spending on IT equipment and tools.

However, software and IT equipment are often expensive. So, if you are planning to expand or change your business practices, it doesn’t make sense to purchase a lot of IT equipment right away. And if you’re just starting out, you may not be able to secure a business loan quickly.

The best way to fulfill your IT needs is by leasing IT equipment. Here are 5 reasons why companies prefer leasing their IT requirements.

Benefits of Leasing IT Equipment

#1 It is cost-effective

Not only does leasing IT equipment and solutions lower initial costs, but it also helps you stick to your monthly budget. Here’s how.

Suppose you need to purchase certain IT equipment for all your employees. This purchase will cost a lot, and it is not always possible to have a large amount to pay upfront. IT equipment leasing can help reduce initial costs. Then, the monthly costs of IT equipment leasing are predictable throughout the term of your lease. So you will know exactly how much you need to pay every month to balance the books.

#2 Simple upgrades

It is a fast-evolving field. Hardware devices get frequent upgrades, and new software updates are rolled out every week. And you need to stay up to date.

Leasing IT solutions and equipment makes upgrading easier because you can simply lease the most up-to-date software and equipment. Once your current lease period ends, you can switch to new, updated versions quickly.

#3 Access to better equipment and improve efficiency

If you choose to purchase hardware equipment and pay upfront, you are restricted by your immediate budget. You might have fewer choices and end up settling for less. But, leasing IT equipment spreads the cost of the purchase over many years. This means that you can lease equipment that is of better quality. Then, you can upgrade it after your lease period ends.  

#4 Lower maintenance costs

IT equipment is also subject to wear and tear. Malfunctions and technical issues can bring your business to a halt. However, it can be a hassle to regularly maintain and repair your equipment, especially if you run a growing business with several employees. Leasing arrangement ensures timely upgrade of IT assets and lowering of maintenance costs, as they can save on spiralling maintenance costs associated  with older machines.

#5 Tax benefits

Lease payments are considered business expenses, which are typically tax deductible. So, when you file your tax returns, you can deduct the lease amount paid in a year from your total taxable income.

Final thoughts

The rise of remote work has ushered in a new era of flexible workplaces, which means that organizations need to manage a dispersed workforce while ensuring greater asset and data security. Thus, adopting a ‘technology-driven approach’ is the need of the hour. Leasing IT equipment can help you make your business future-ready at a lower cost and with the best hardware.You have an option to buy back or extend the  asset at the best buyback price/extension rental & hassle free return of assets where we arrange for pick up from your location after lease maturity.

Tata Capital Asset Lifecycle Management Solutions is here to help you make your company asset-light, reduce stress on your budget, and make sure you get the IT equipment that best suits your business needs. Visit our website to know more.

If you're looking for further assistance regarding our equipment loans and application process, drop a mail with us to Leasing@tatacpaital.com and an expert from our side would get in touch with you.

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