What is leasing?

In short

Leasing is renting equipment or cars over an agreed period instead of buying. The business pays a running fee and ties up no capital in the asset.

In practice

With operational leasing the leasing company owns the asset and the fee is expensed as it falls; financial leasing effectively resembles a purchase by instalments. Leasing white-plate cars carries special VAT rules — only part of the VAT on the fee is deductible.

Related terms

• Fri bil (company car benefit)
• Afskrivning (depreciation)
• Anlægsaktiver (fixed assets)
• See every term in the dictionary

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