Equipment Finance in Jersey: Funding Business Assets

If your business needs machinery, IT or a commercial vehicle and you would rather not pay for it out of cash, equipment finance lets you spread the cost over the working life of the asset while the asset itself secures the funding. The main choices in Jersey are hire purchase, a lease, or refinancing kit you already own — and the right one depends on whether you want to end up owning it.

This guide covers how each structure works, what a funder will look at, and the Jersey-specific points — GST on imports in particular — that change the numbers. If you want to compare quotes, our equipment financing page explains how to send an enquiry.

Hire purchase: paying towards ownership

With hire purchase, the funder buys the asset and you pay for it in instalments over an agreed term. Ownership passes to your business once the final payment, usually including a small option-to-purchase fee, has been made.

It suits assets with a long useful life that you expect to keep: plant, workshop machinery, a van you will run into the ground. Until the last payment, the funder owns the asset, so you cannot sell it without settling the agreement first.

Leasing: using the asset without owning it

Finance leases and operating leases let you use equipment for a fixed rental while the funder keeps ownership.

• Finance lease — you pay close to the full cost of the asset over the term and carry the running and maintenance costs, but title stays with the funder.
• Operating lease — you rent the asset for part of its life and hand it back, so the funder carries more of the resale risk.

Leasing is often chosen for technology that dates quickly, where owning a three-year-old server or scanner is worth little.

Releasing cash from kit you already own

Asset refinancing works the other way round. If the business owns equipment outright, a funder can advance money against it and you repay over a term, turning equity in the asset back into working capital.

The amount available depends on what the funder thinks the asset would fetch if it had to be sold, which for specialist or heavily used machinery can be well below what you paid.

How GST on imported equipment changes the figure

Most equipment bought for a Jersey business comes from the UK or further afield, and that has a direct effect on the amount you need to fund.

Goods brought into Jersey attract GST at 5%. Any UK VAT charged is treated as part of the goods' value, so GST is paid on the VAT too — unless you can show the VAT was refunded to you, in which case the GST on it is refunded. Keep the evidence of any VAT refund, and work out the landed cost before you ask for a quote.

Businesses must register for GST once taxable supplies reach £300,000 in the preceding 12 months, or are expected to exceed that in the coming 12 months. Tell the funder whether you are registered, because it affects how the GST element of the purchase is treated and whether it needs to be financed at all.

What a funder will want to see

Asset finance is secured on the equipment, but the funder still needs to be confident the business can meet the payments. Expect to be asked for:

1. Recent accounts or management figures, and business bank statements.
2. A cash flow forecast showing the repayments are affordable, particularly if income is seasonal — tourism, agriculture and fishing businesses should show the quiet months, not just the peak.
3. A supplier quote or invoice for the asset, with its age and specification if it is used.
4. Details of any existing finance secured on business assets.

Match the length of the agreement to the asset's working life. Paying for a machine for two years after it has stopped being useful is a common and avoidable mistake.

Comparing quotes on more than the monthly payment

Two quotes with similar monthly payments can cost quite different amounts in total. When you compare, look at:

Cost	Why it matters
Documentation and set-up fees	Charged at the start and easy to overlook
Option-to-purchase fee	Payable at the end of hire purchase before title passes
Early settlement terms	Decides what it costs to upgrade or sell the asset mid-term
Maintenance and insurance duties	Often fall on you under a lease, not the funder
End-of-lease terms	Return conditions, extension rentals and damage charges

Ask an accountant in Jersey how capital allowances and tax deductions apply to your chosen structure before you sign, as hire purchase and leasing are treated differently.

Bestloans.je is an introducer, not a lender. Sending an enquiry involves no credit check; the team compares options from several lenders across Jersey and Guernsey and aims to call you back within one business day. Any lender you go on to apply with will run its own checks.