Leaseback– a popular form of leasing, when the seller is the same person. At the same time, only two organizations appear in the leaseback agreement - the leasing company and, which sells its equipment (or other property) and then leases it.
Leaseback gained popularity in 2013, when (for most objects) it would have been cancelled. At the same time, registration of leasing allowed the lessee to withdraw its assets from taxation and thus increase the financial benefit from the transaction.
The essence of leaseback
Leaseback is essentially very similar to standard option transactions - financial leasing. The only difference is that one legal entity acts as the lessee and the seller. The scheme works as follows. The company that owns any equipment sells the property to the selected leasing company. After this, the seller enters into an agreement with the lessor to lease the already sold equipment. At the same time, in the document between the parties there is no clause regarding the transportation of goods, because all the property remains in the old place and continues to operate as before. The only difference is that its owner has changed.
As a result, the company realizes its main task - attracts additional working capital to implement any primary tasks (expanding production, fulfilling obligations to partners, paying debts to creditors, and so on). In this case, the assets of the lessee (seller) increase exactly by the amount that the leasing company pays for the provided object.
Leaseback is a scheme that was developed in the 70s of the 20th century in France in order to stimulate investment in the real estate market. Currently, leaseback is widely used in many developed and developing countries, including Russia.
The essence of leaseback: Party A sells property to Party B. Next, party B (the new owner of the property) leases this property to party A for financial lease (leasing).
Advantages of leaseback:
The ability of party A to free up funds for their involvement in the turnover of the enterprise;
Party A’s ability to replenish current working capital;
Possibility for both parties to apply tax preferences.
Legal basis: para. 4 paragraphs 1 art. 4 Federal Law dated October 29, 1998 No. 164-FZ, according to which the seller of property can simultaneously act as a lessee of the same property.
Registration of legal relations.
Judicial practice proceeds from the fact that in order to formalize a leaseback it is necessary to conclude two interrelated agreements: purchase and sale and leasing.
Inflating the price of a real estate lease agreement entails an increase in the amount of expenses that reduce the taxable base for income tax (
Leasing services are actively developing in Russia. Typically, a leasing transaction involves the acquisition of property for the lessee and its transfer for rent with the condition of further purchase.
But the concept of leasing includes different kinds transactions. One of the options is leaseback, aimed at attracting working capital.
The essence
Leasing involves the acquisition by the lessor of property for the client and its subsequent transfer for rent. Unlike conventional leasing transactions, in leaseback, the client acts as both a seller and a lessee.
Typically, companies resort to leaseback in situations of shortage of working capital. In this case, the property that originally belonged to the client is transferred to the ownership of the leasing company.
Simultaneously with the purchase and sale agreement, a leasing agreement is concluded, and the client receives his equipment or other property for rent. Leaseback, in essence, represents an alternative to secured loans.
General characteristics of leasing relations
Exist various options leasing transactions.
With classic leasing, a minimum of four participants are involved in the transaction:
- the lessor financing the transaction;
- lessee purchasing property;
- the seller supplying machinery, equipment or other leasing object;
- an insurance company that insures the leased object against various risks.
Large transactions usually involve the involvement of additional parties, such as banks.
Leaseback differs from classical leasing in that the seller and lessee are the same person. In essence, the client sells the property to the leasing company and immediately leases it with the right of subsequent purchase.
Leaseback of real estate for individuals
Leaseback is popular mainly among business representatives as a source of replenishment of working capital. In principle, legislation allows participation in transactions and individuals.
Leasing companies take into account the risk of low solvency of private clients and prefer not to cooperate with this category of clients. Although there are exceptions, they are very few.
Let's give detailed conditions for real estate leaseback for individuals in the following table.
Often, when leasing back real estate, individuals receive not very attractive conditions. The value of the property is underestimated, and various commissions and fines are included in the contract.
The situation with unfavorable conditions for real estate leasing back for individuals is connected with the fact that this form of financing is mainly sought by clients who find themselves in a hopeless situation.
Important! In most cases, real estate leaseback for individuals can only be considered as a temporary solution to the problem.
For legal entities
The services of leasing companies in Russia are mainly aimed at business representatives. This is due to the opportunity to obtain VAT deductions from the lessee, which causes increased demand for the service.
Companies are ready to offer leaseback services for commercial real estate or production premises. However, the conditions may differ slightly from different companies.
In the following table we compare the most popular real estate leaseback offers for legal entities.
Video: Development results
Legislation
Leaseback does not contradict current legislation Russian Federation and is a completely legal scheme.
Leasing transactions are regulated by the following documents:
- Civil Code of the Russian Federation (Article 665 - 670);
- Federal Law “On Financial Lease (Leasing)” dated October 29, 1998 N 164-FZ;
- UNIDROIT Convention on International Financial Leasing;
- Federal Law of February 8, 1998 N 16-FZ “On the accession of the Russian Federation to the UNIDROIT Convention on International Financial Leasing.
Before concluding a deal, you should definitely spend a little time and study in detail legislative framework. This will eliminate unnecessary questions when concluding a payment agreement.
Strict compliance with the law will allow you to get the maximum benefit from the leasing transaction and eliminate various problems.
According to the law, ownership of the property remains with the leasing company until it is repurchased. This prevents the lessee from pledging it to the bank or selling it again.
Scheme
The interaction between the parties in a leaseback is slightly different from classical scheme. This is due to the fact that the seller and the lessee are the same person.
Let's consider the standard scheme of a leaseback transaction:
- the client submits an application for financing and a package of documents to the company;
- the lessor's specialists analyze the information and documents received and make a decision on the transaction;
- the parties agree on the terms of a specific transaction and sign a leasing agreement simultaneously with the property purchase and sale agreement;
- ownership of the property passes to the lessor, and the lessee receives it for temporary possession;
- the client pays regular payments and redeems the property at the end of the contract term.
Typically, the registration procedure takes from 5 to 20 working days, depending on the type of leased property and the amount of financing.
Conditions
The cost of the leased property is determined by the parties through negotiations or based on assessments. In this case, the volume of financing can reach 70-90% of the cost of the leased property.
The terms of the deal may provide for an advance on the project at the expense of own funds client. In this case, the amount of joint financing can reach 100% of the property price.
The price increase is determined individually for each client. It depends on financial indicators lessee, leased object, transaction term and other conditions. The minimum increase in price per year is 5-8%.
It is necessary to take into account that property transferred under a leasing agreement must be insured. This ultimately has a negative impact on the final price increase, significantly increasing it.
The validity period of a leaseback agreement for vehicles can be up to 3 years, for equipment – 5, and for real estate, rolling stock, and aircraft – 10 years.
Table. Basic conditions of leaseback.
Goals
The main purpose of leaseback for companies is to obtain additional working capital.
There are also additional goals:
- reducing the tax burden in a legal way;
- use of opportunities for accelerated depreciation of property;
- consolidation of equipment within one transaction when purchasing from large number suppliers.
Individuals resort to leaseback when they find themselves in difficult financial situations. It's no secret that signing an agreement with a leasing company is easier than getting a bank loan.
Objects
Almost any equipment and machinery, as well as real estate, can be leased objects. In this case, it is possible to register a transaction not only with new property, but also with used property.
Let's consider the most common options for leasing objects:
- cars (cars, trucks);
- railway and water transport;
- special equipment;
- real estate;
- aircraft;
- various equipment.
Calculation example for cars
When concluding a leasing agreement, the parties must sign a payment schedule. It specifies specific amounts. In this case, the peculiarities of the activities of a particular client and his wishes may be taken into account.
Let's look at what parts the lease payment consists of:
- depreciation deductions;
- payment for used borrowed funds;
- leasing company commission;
- payment additional services(for example, insurance);
- the cost of the property being purchased.
Typically, the following formula is used to calculate the total amount of lease payments:
Total amount of lease payments = depreciation charges for this year+ fee for using borrowed funds + lessor commission + additional fee. services + VAT.
Let's give an example of calculating leasing payments for a car worth 1 million rubles, a leasing period of 5 years, an increase in price of 7% per year, and a redemption value of 1%.
It’s easy to determine the overall price increase:
1000000 rub. / 100 * 7% * 5 years = 350,000 rubles (for all 5 years).
Let's calculate the entire leasing cost:
1,000,000 + 350,000 + 10,000 (1% of the redemption value) = 1,360,000 rubles.
When concluding a transaction, the client makes an advance payment of 30%. It is 300,000 rubles. According to the payment schedule, the amount will then be 1,260,000 – 300,000 = 960,000 rubles.
Sample contract
Each company independently draws up standard leasing agreements for various types transactions. They should be carefully studied, as sometimes they contain conditions that are not convenient for the client, for example, fines and commissions.
Let's consider the main points of the leaseback agreement that you should pay attention to when signing:
- validity;
- transaction amount;
- interest rate and commissions;
- penalties;
- conditions for early redemption of property.
Accounting and tax accounting
The lessee, when selling equipment, must reflect income in the amount of the full sales price excluding VAT and at the same time other expenses in the amount of the cost of the equipment.
Tax accounting also recognizes income from the sale of property without VAT. It is reduced by the cost of the purchased equipment excluding VAT, and when purchasing used equipment - in the amount of the residual value.
The operation of transfer of ownership is considered an object of taxation. IN established by law deadlines need to issue invoices for the transaction.
When receiving property from a leasing company, the equipment is taken into account in the amount of the full cost, taking into account the redemption price, and is reflected in the debit of account 08 “Investments in non-current assets” subaccount “Purchase of fixed assets under a leasing agreement” in correspondence with the credit of account 76 subaccount “Debt to the lessor” "
Tax risks
Tax authorities often pay close attention to leaseback transactions. Federal Tax Service officials believe that in this way companies are trying to illegally evade taxes.
You should know that leaseback transactions are not prohibited by law. It is necessary to be prepared in advance to respond to claims from tax authorities with the involvement of appropriate lawyers.
Advantages and disadvantages
Leaseback is one of the popular measures to attract additional funds while maintaining the right to own property.
It has the following advantages:
- long terms;
- quick approval of the transaction;
- the possibility of obtaining tax preferences;
- minimum set of documents.
Among the minuses, it should be noted the mandatory insurance of the leased item and increased attention to such transactions on the part of the tax authorities.
Leaseback is an excellent way to attract working capital for legal entities. This source of financing allows you to quickly obtain the missing finances, but it is necessary to take into account the risks associated with the transaction. If the contract is violated, the lessee risks being left without property.
How does such a transaction differ from a regular leasing agreement? How do its features help entrepreneurs? If the returnable instrument caused legal entities complete inconvenience, its appearance among economic instruments could not have taken place.
Three parties are involved in concluding a classic leasing transaction: the user of the service, the seller of the property and the leasing company. There is no seller in leaseback. Here the property owner combines two roles. He acts as both a seller and a buyer at the same time.
In fact, he buys from himself through the intermediary of the lessor. Why was it necessary to fence the garden if the property was already used in production? It seems so at first glance. In fact, entrepreneurs reap significant benefits.
Detailed analysis of leaseback for individuals
What benefits do you get from renting your own property? With its help, you can increase the profit of the enterprise without reducing the fixed assets involved in the production of products. With such a system, there is no need to waste time searching for a supplier and languish waiting for the delivery of the purchased goods.
The equipment or production space available at the enterprise is simply sold to a company providing leaseback services. The entrepreneur then leases this property. The difference between the selling price and rent constitutes the entrepreneur's profit. The purchased product is used in production process, but is not property. From this moment it belongs to the lessor.
In more detail, the design of a leaseback looks like this:
- The parties to the purchase and sale transaction agree on the terms and sign the drawn up leasing agreement. It is issued to both individuals and legal entities. This measure is intended to timely record accounting transactions and avoid problems with the taxation system. After all, the sold property receives a new owner, changing the tax base of both participants.
- The contract specifies the value of the property reached as a result of negotiations. After the transaction is concluded, the seller, who is also the lessee, is obliged to pay rent to the leasing company.
- When, in accordance with the agreements, the period of use of the property ends, the entrepreneur buys it from the lessor or extends the contract. When purchasing, only the residual value is paid.
As a result of the leaseback operation, both parties benefit. The company receives additional funds for circulation, and the leasing company withdraws profit, because the rental proceeds exceed the price specified in the contract.
The essence of leaseback for individuals
The main difference from regular leasing is the number of participants and their status. There is no seller here, and the tenant acts in two persons. He both sells and uses the subject of the leaseback transaction. In this state of affairs, the parties sign two contracts, since it is necessary to document the sale of property and its provision on lease.
There are other differences:
- Rental period. Directly depends on the value of the property involved in the transaction. If a vehicle is provided under leaseback terms, the maximum rental period is 3 years, for real estate transactions - 5 years.
- An enterprise that leases equipment, a building, or a vehicle makes money by selling the property to the leasing company. This is the main goal that forced the entrepreneur to enter into an agreement. This money is spent on pressing problems of the company and is not limited to its intended purpose.
- Minimum volume of documents to be compiled.
Leaseback is a wonderful way to reduce tax expenses. As a result of the transfer of property to the balance sheet of the leasing company, the tax deductions of the enterprise are reduced. It happens that dishonest entrepreneurs evade taxes by concluding fictitious transactions.
The Tax Service is well aware of this and monitors the cleanliness of the operation. Transactions are carefully checked, especially if the companies entering into them have long-term cooperation. When the deception is discovered, the businessman who committed the fine will have his rights under the law revoked. tax deductions. The need for leaseback will have to be justified based on financial evidence.
What property is suitable for leaseback
Not everything is suitable for leaseback. The following property is suitable:
- technological equipment;
- special equipment:
- Trucks or passenger vehicles:
- Residential Properties;
- production premises or entire enterprises.
When purchasing property, the leasing company reduces the value due to wear and tear resulting from operation by the previous owner. In most cases, she will refuse to purchase rarely used or high-priced items. If the tenant subsequently refuses to purchase the property, the lessor will have problems with its further sale.
When signing the contract, the possibility of moving property is taken into account. Dismantling and delivery to the site of further operation should not increase the final cost. When valuing real estate, it is important geographical location and related infrastructure. Documents certifying ownership are checked.
Leaseback is used by entrepreneurs to improve their deplorable financial situation. With the help of the money received from the sale, the debt is paid off bank loans, update the vehicle fleet or equipment. This helps reduce the cost of production and increase demand for it.
The owner of the property during leaseback finds himself in good plus, and the leasing company is at risk. Often such a deal is concluded by entrepreneurs to get rid of loss-making objects. The lessor's employees have to carefully evaluate the proposed property and the personality of the future client. If you don't do this, you could suffer serious losses.
Leasing operations are classified into several types. One of them is called leaseback (hereinafter RL).
This type of transaction involves the purchase and sale of property on leasing terms, which is subsequently transferred into the possession of the seller.
It would be natural to assume that this type The transaction is accompanied by the signing of a corresponding agreement. The number of participating parties is two.
Most often to this method resort to obtain additional funds for the development of the organization. Credit money is often unavailable to a company for some reason.
Features of the reverse leasing system
The OL object can be property with a high price and a long service life. When it comes to equipment, it must be taken into account that it should not be obsolete at the time of execution of the agreement.
Companies that provide leaseback often refuse to register for assets with a service life of less than twelve months.
Often the OP does not carry any security (guarantees, pledges). Even if collateral is provided, its conditions are less stringent, unlike bank loans. This is due to the fact that most often we are talking about production (technological) equipment. The scope of its application is quite narrow and it is much more difficult to sell it.
Leasing companies often use not only their own money, but also investor money, and sometimes credit money. It is in view of this that Russian cars are rarely used as a leased item (as they are of low quality). In essence, the OL is based on a purchase and sale transaction. This means that when preparing it, an expert assessment of the subject takes place.
Some features of this operation
Leaseback companies have the right to limit the use of the item. These requirements can be minimized if the borrowing company has a strong reputation and positive experience. Not only investor corporations, but also banks resort to such a scheme as OL. Or, for example, car dealerships.
Leasing schemes make it possible to minimize the tax burden to some extent. But this is only possible for those organizations that operate in general scheme taxation. The fact is that leasing payments for the operation of property can be attributed to the company’s expenses. This means that these amounts can be removed from tax funds. The same thing happens with insurance premiums.
Below you can download forms, samples of reverse leasing agreements, and also receive highly qualified assistance from our legal consultants. Links and form at the bottom of the page.
Loading...