Asset Finance
Finance built
around the asset.
Structured finance for the acquisition of business capital equipment across all major asset categories.
What is asset finance?
Asset finance is a broad category of commercial lending structures used by UK businesses to acquire capital equipment without deploying the full purchase price upfront. The equipment itself — or the cash flows it generates — provides the security for the finance.
The UK asset finance market is a substantial, established part of the commercial lending landscape. It provides access to critical infrastructure — plant, machinery, vehicles, technology — for businesses across every sector.
TAFM provides the marketplace infrastructure through which businesses access this market — with one structured application assessed by a network of specialist finance providers.
Asset-backed
The asset itself is the primary security. No general charge over the whole business is required in most structures.
Cash flow preservation
Businesses preserve working capital by spreading the cost of an asset over its useful working life.
Tax efficiency
Different structures offer different tax treatments — capital allowances, rental deductions, VAT timing.
Speed of access
Specialist asset finance lenders can move faster than general commercial lenders on equipment acquisitions.
Finance structures
The structures available.
The main structures used to finance business asset acquisition in the UK. Each has different ownership, tax and balance sheet implications.
Hire Purchase
Business owns the asset at end of term.
- Term
- 12 – 72 months
- Ownership
- Business
- VAT
- Payable upfront on full asset value
- Balance sheet
- Capitalised from commencement
The finance provider purchases the asset. The business repays the cost over an agreed term, plus interest. Ownership transfers at the end, typically on payment of a nominal purchase fee.
Typically used for
Assets the business intends to own long-term
Finance Lease
Lender owns the asset; business leases for most of its life.
- Term
- 12 – 84 months
- Ownership
- Finance provider
- VAT
- Payable on each rental payment
- Balance sheet
- On balance sheet under IFRS 16
The finance provider retains legal ownership throughout the primary lease period. The business pays rentals covering most of the asset cost. At end of term: secondary period, sale as agent, or return.
Typically used for
Assets the business wants to use, not necessarily own
Operating Lease
Shorter term; lender takes residual value risk.
- Term
- 12 – 48 months
- Ownership
- Finance provider
- VAT
- Payable on each rental payment
- Balance sheet
- Typically off balance sheet
Similar to Finance Lease but the primary period does not cover the asset's full economic life. The lender retains significant residual value risk. Lower monthly payments. Return, extend or upgrade at end of term.
Typically used for
Depreciating assets: vehicles, technology
Asset Refinance
Release capital from assets already owned.
- Term
- 12 – 60 months
- Ownership
- Finance provider
- VAT
- Dependent on structure
- Balance sheet
- Dependent on structure
The business sells an asset it already owns to a finance provider and immediately leases it back. The business continues to use the asset and receives a cash injection equal to the agreed sale value.
Typically used for
Unlocking capital from owned assets
Important: This page provides general information about asset finance structures. It does not constitute financial advice. The suitability of any finance structure depends on your specific circumstances, tax position and the assets being financed. Seek independent financial or tax advice before committing to any agreement.
Sectors
Businesses we work with.
Manufacturing businesses
Acquiring CNC machines, presses, injection moulding equipment and automated production assets.
Construction firms
Financing excavators, cranes, piling rigs, scaffolding systems and specialist groundworks equipment.
Agricultural businesses
Tractors, combine harvesters, irrigation systems and precision agriculture technology.
Commercial transport operators
HGVs, LGVs, refrigerated vehicles, specialist transport and abnormal load vehicles.
Healthcare providers
Imaging systems, diagnostic equipment, surgical technology and dental equipment.
Technology-led businesses
Servers, network infrastructure, production technology and broadcast equipment.
Ready to explore your options?
Start your application or use the finance calculator to understand indicative costs before applying.