Equipment finance for UK businesses
Asset finance lenders specialise by class, and factory plant, restaurant and bar kit and computer hardware are each funded on their own terms. This guide puts hire purchase, leasing and a plain loan side by side, then goes equipment type by type, so you can see before you enquire what decides a case for the machine you have in mind.
CapExpand Ltd (FRN 1060885) is a credit broker and an Appointed Representative of White Rose Finance Group Limited (FRN 630772), which is directly authorised and regulated by the Financial Conduct Authority. We are a broker, not a lender. Finance arranged for UK limited companies and LLPs.
Hire purchase or lease
Own it or rent it
Secured on the kit
The equipment is the security
Lender-set
Term, published by each lender
Commission
From lenders, disclosed to you
Key points
- The equipment is the lender’s security: the lender pays your supplier, and it can take the machine back if the payments stop.
- Hire purchase puts the VAT on the full price at the start and the kit in your name at the end; a lease charges VAT on each rental and the lessor keeps the title.
- Used equipment narrows the field, since each lender publishes the age of machinery it will fund, and second-hand plant sits outside full expensing, though the £1 million annual investment allowance still applies.
What equipment finance is, and who is writing it
Equipment finance is asset finance with the machine as the lender's security. The lender pays your supplier, you pay the lender monthly, and if the payments stop the lender takes the machine back. The asset's resale value is part of what the lender weighs, alongside the business's own accounts.
The market is large and still growing. The Finance & Leasing Association recorded £40.3bn of asset finance written for UK businesses in 2025, £24.4bn of it to SMEs, and its June 2026 release, read on 8 September 2026, showed new business 15% ahead of June 2025, with plant and machinery finance up 17% and IT equipment finance up 21%.
Through our lender panel we have access to a range of asset finance lenders. We arrange finance for UK limited companies and LLPs through that panel, and each lender makes its own decision on each case.
Hire purchase, lease or loan
Three ways to pay for the same machine, and the differences sit in who owns it, when the VAT falls due and what happens at the end. HMRC treats hire purchase as a supply of goods, so VAT is due on the full value at the time of supply (VAT Notice 700, section 8.4); a lease is a continuing supply, with VAT on each rental. A loan buys the machine outright and leaves the VAT on the supplier's invoice.
| Hire purchase | Lease | Loan | |
|---|---|---|---|
| Who owns the kit | The lender until the final payment, then you. | The lessor, throughout. | You, from the supplier's invoice. |
| When VAT falls due | On the full price at the start; a VAT-registered business reclaims it on its next return. | On each rental as it is charged. | On the supplier's invoice, as with any purchase. |
| What secures it | The equipment itself. | The equipment, which the lessor already owns. | Nothing on the equipment; a personal guarantee or a debenture is common. |
| Payments | Fixed monthly, with an optional balloon at the end. | Fixed rentals over a primary term. | Fixed monthly. |
| At the end | The equipment is yours. | Return it, extend, or sell it on the lessor's behalf, as the agreement sets out. | Nothing to hand back. |
Regulation follows the borrower rather than the product. An agreement with a limited company or an LLP is not a regulated consumer credit agreement. We work with UK limited companies and LLPs only, for business and commercial purposes.
The broader product is set out on the asset finance page.
Equipment finance, type by type
Asset finance lenders specialise by class, and a narrower field means the case goes only to the lenders whose published criteria cover that class.
Machinery
Machinery is the mainstream of asset finance. Construction plant, agricultural machinery and factory plant share a used market a lender can price, which is also why aircraft and marine kit go to a much shorter list of specialists. Diggers, dumpers and telehandlers have a guide of their own; tractors and combines sit in the farm finance guide.
CNC and manufacturing plant
Factory plant is the class that covers CNC machining centres, lathes, presses and injection moulders. The lender wants the make, model, year and serial number so it can set the machine against the used market before it sets a deposit. The FLA's June 2026 release, read on 8 September 2026, put plant and machinery finance 17% ahead of June 2025, so this is a line lenders are competing for rather than rationing.
Catering and restaurant kit
Ovens, refrigeration, dishwashers and coffee machines go through as hard assets with a resale value. Extraction, ductwork and anything built into the premises are a different case: a second-hand canopy fetches very little, so the lender is really underwriting the restaurant.
Gym equipment
Treadmills, rowers, rigs and plate-loaded machines are branded and serial-numbered and they resell, so a new gym's kit list is a normal asset finance case even where the company is young. Rubber flooring, mirrors and the reception desk do not resell; a lender treats a fit-out as a separate soft-asset class, usually over a shorter term.
Printing equipment
Presses, guillotines, finishing lines and wide-format machines carry high tickets and a specialist used market, so the lender's valuation of the specific model drives the deposit more than the headline price does. Once a press passes ten years old the field narrows to the lenders that fund older machinery.
Computer hardware
Servers and workstations lose value quickly, which is why a lease with a short primary term is the usual shape here and why "hand it back" matters more than "own it at the end". The FLA recorded IT equipment finance up 21% in June 2026 against June 2025, the fastest-growing equipment line in that release.
Shop and office fit-out
Counters, lighting, partitioning and signage have no second life, so the lender is underwriting the business rather than the kit: filed accounts and bank statements carry the case, a personal guarantee is usual, and the term is shorter than on machinery. Where a fit-out comes with hard assets (the coffee machine, the till system), a lender may treat each part as a separate asset class.
Medical and dental
Chairs, imaging, sterilisation and scanners are the usual kit. Finance through us is for practices that trade as a limited company or an LLP.
What used equipment changes
Two criteria narrow the field before anyone opens your accounts: the age of the machine and who is selling it. Kit over ten years old goes to a shorter list of lenders, and a private-seller purchase to a shorter one again. Buy an eight-year-old press from a dealer and the choice is wide. Buy a twelve-year-old one from another printer and you are choosing among a handful, which is a reason to tell us the seller before you agree the price.
The tax position changes too. Full expensing, the 100% first-year deduction for companies, applies to expenditure from 1 April 2023 on plant and machinery that is “unused and not second-hand” (Capital Allowances Act 2001, section 45S). Used equipment falls back on the annual investment allowance, which gov.uk sets at £1 million a year, a figure unchanged since 1 January 2019. The AIA page excludes business cars and items you already owned for another reason; it says nothing against second-hand plant. This is not tax advice; ask your accountant which allowance applies to a given purchase. We arrange the finance.
Auction and dispersal-sale purchases are private-seller cases with a payment deadline the lender did not set. The plant guide covers auction buying in detail, and our answer on asset finance for used machinery sets out what a lender asks for on older kit.
What a lender asks for
Filed accounts where they exist, recent bank statements, director details and, for the equipment itself, a supplier quote showing make, model, age and serial number. A private limited company does not owe Companies House its first accounts until 21 months after incorporation, so a company under two years old may have none on file, and the lenders that take that case read the bank statements and the director's history instead. A loss in the last accounts, or adverse credit on the business, does not close asset finance to every lender, because the machine carries part of the risk that the accounts would otherwise carry alone.
Enquiring does not affect your credit score. If you apply to a lender, it runs its own credit search, which may be recorded on your file. A lender runs its own checks once you decide to proceed with it, and you will know which lender it is and what it will look at before that happens.
What it costs
Each lender publishes its own term range and deposit requirement, which move with the equipment and the business, and they change. Asset finance is usually priced as a flat rate charged on the opening balance for the whole term, so the APR it implies is a good deal higher than the number on the quote. Ask for the APR and the total payable before you sign.
VAT is the other cost that lands on day one. Some asset finance lenders offer VAT deferral, funding the VAT until your return recovers it, so on a £60,000 machine that keeps £12,000 in the business for a quarter rather than on the lender's ledger.
What asset finance will not cover
Where an asset lender loses interest is kit nobody would want back. A second-hand extraction canopy, a shopfit, a fitted bar, a made-to-order sign: the resale value is close to nil, so the lender either prices it as an unsecured risk or declines it.
Costs vary by facility and lender. We show the total repayable each lender quotes, the choice stays yours, and we do not advise.
How it works
Tell us about the equipment
What it is, new or used, who is selling it, the price and how you trade. Two minutes on the form or a phone call.
We check it against the panel's published criteria
Age, seller and asset class decide which of the lenders can write it; we put your case only to those.
You compare the terms
Deposit, term, monthly payment and total payable, side by side, with the VAT position spelled out.
The lender pays your supplier
You sign, the funder settles the invoice, and the equipment arrives.
The panel behind this page
An equipment case goes only to the asset finance lenders whose published asset-class criteria cover the kit. Lenders set different criteria on trading history, seasonality and credit history, and each lender makes its own decision.
We check each lender’s published criteria first, and your case goes only to lenders whose requirements it meets. How a case is checked against criteria is set out on our how we work page.
Which stages are in your hands
The lender underwrites the asset and the business; the stages below sit with the buyer and the supplier, and they decide the date the equipment is paid for.
The specification and the quote
A quote that names the equipment, its model, its serial number where it exists and the price, in the company’s name, is what the lender funds against. A quote addressed to a director personally is returned.
New or used, and from whom
A dealer sale carries a warranty and a clean title; a private sale needs the seller’s identity and proof of ownership, and some lenders do not fund one. Settling that before the enquiry decides which lenders can look at it.
Installation and commissioning
Equipment that needs installing, from a commercial kitchen to a CNC machine, is paid for on the business confirming it is in place and working. The installation date, not the delivery date, is the one the payout follows.
The deposit and the VAT
On hire purchase the VAT is commonly paid at the start with the deposit; on a lease it is spread over the rentals. Having the deposit ready and knowing which treatment the business wants keeps the signing to one round.
What can go wrong
Equipment deals go wrong at the equipment more often than at the credit.
- Soft assets a lender will not take. IT, software, fit-out and some medical and beauty equipment have little resale value, so fewer lenders fund them and those that do price for it. A case sent to a lender that publishes hard assets only declines late.
- A supplier who will not invoice the lender. The lender pays the supplier directly and needs an invoice in its own form. A supplier who insists on being paid by the business first breaks the structure.
- Equipment that depreciates faster than the term. A long agreement on kit that is worthless in two years leaves a balance larger than the asset. A guarantor carries the shortfall if the business fails.
- The accountant not consulted. Hire purchase, finance lease and operating lease are treated differently for tax and the balance sheet. The choice is the business’s own, and many make it with their accountant before signing rather than after.
Equipment finance questions
What is machinery finance?▼
Asset finance with the machine as the lender's security. The lender pays the supplier, you repay monthly, and the agreement is written against the make, model and serial number. Factory plant, construction plant and agricultural machinery are mainstream classes for asset lenders, because each has a used market a lender can price.
How does equipment leasing work?▼
The lessor buys the equipment and keeps the title; you pay fixed rentals over a primary term and VAT is charged on each rental rather than on the full price at the start (HMRC VAT Notice 700, section 8.4, read 8 September 2026). At the end of the primary term the agreement sets out whether you return the kit, keep renting it for a nominal amount or sell it on the lessor's behalf. Leases are common on IT and other equipment that a business replaces every few years.
What are business equipment loan rates?▼
Asset finance is normally quoted as a flat rate rather than an APR, and lenders rarely publish it, so there is no honest single number to quote. The rate any business is offered depends on the lender's own assessment of the business, the asset and the term.
Who provides equipment finance in the UK?▼
High-street banks, the finance arms of manufacturers, and independent asset finance lenders that fund nothing else. Through our lender panel we have access to a range of asset finance lenders. The Finance & Leasing Association counted £40.3bn of asset finance written for UK businesses in 2025, £24.4bn of it to SMEs.
Which types of equipment do lenders actually fund?▼
Nearly anything a business uses. Asset finance lenders set out what they fund class by class, and construction plant, agricultural machinery, medical and dental equipment, gym equipment and EV charging installations all appear in published criteria. A lender may also agree to defer the VAT on the purchase.
Is equipment finance regulated by the FCA?▼
Hire purchase, leasing or a loan to a limited company or an LLP is not a regulated consumer credit agreement. CapExpand Ltd (FRN 1060885) is a credit broker and an Appointed Representative of White Rose Finance Group Limited (FRN 630772), which is directly authorised and regulated by the Financial Conduct Authority. We work with UK limited companies and LLPs only, for business and commercial purposes.
Sources
- HMRC, Capital allowances: annual investment allowance (gov.uk)
- Capital Allowances Act 2001, section 45S: expenditure in the period of full expensing
- HMRC, VAT guide (VAT Notice 700), section 8.4 on hire purchase and conditional sale
- Finance & Leasing Association, asset finance statistics, June 2026 release
- Companies House, accounts filing deadlines for a private limited company
Government, legislation and FLA pages were read on 8 September 2026 and change without notice.
What customers say
Trustpilot reviews are quoted as written on Trustpilot; case-study quotes link to the full story
“First class service and so quick with the responses.”
Tell us about the equipment
What it is, new or used, who is selling it and the price. We come back with the lenders whose published asset-class criteria the purchase meets. A named person calls you back within one working day.
Important information
Asset-class coverage, VAT treatment and capital allowance rules are general descriptions; each lender applies its own limits and your accountant confirms the tax position on a specific purchase.