Compare leasing vs buying the same asset
Enter the asset value once, then set the parameters for each path. The calculator shows total cash outlay over your chosen comparison period plus what happens at the end of that period.
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Buy path (chattel mortgage / loan)
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Conservative for utes ≈ 30–45% after 5 yrs; specialist machinery varies.
Lease path (finance / operating)
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Usually slightly higher than loan rates (residual risk priced in).
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Side‑by‑side over 5 years
| Component | Buy | Lease |
|---|---|---|
| Monthly payment | $0 | $0 |
| Total instalments over period | $0 | $0 |
| End‑of‑period lump (balloon / residual) | $0 | $0 |
| Cash out over period | $0 | $0 |
| Asset value retained at end | $0 | $0 |
| Net cost (cash out − asset retained) | $0 | $0 |
Estimated difference (negative = lease cheaper) $0
How this calculator works
- Buy path: chattel mortgage / loan amortised over the comparison period using the standard reducing‑balance formula with the balloon at the end. Asset is held; estimated resale value at end of period is treated as cash retained.
- Lease path: lease payments calculated on the same reducing‑balance basis with the residual at the end. If returning the asset, no asset value is retained. If paying out the residual, asset value retained = asset value at end (approximated as the residual amount).
- Net cost = (total cash out) − (asset value retained at end of period). This is the simplest meaningful "all things equal" comparison.
What this calculator does NOT model
- Tax effects. Deductions for interest + depreciation (buy) vs lease payments (lease) can shift the after‑tax answer meaningfully. Speak with your accountant.
- GST timing. Buy paths typically claim GST up front; lease paths claim per‑payment. Cash‑flow impact can be significant in year one.
- Maintenance. Operating leases often bundle maintenance and warranty; buy paths don't.
- Resale risk. The buy path's net cost depends on actual resale value, which can be higher or lower than your estimate.
- Cash‑flow timing. The calculator compares totals, not when cash leaves the business each year.
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Talk through your lease-vs-buy decision
The calculator gives you a clean side-by-side, but the real decision usually has tax, cash-flow and upgrade-cycle factors that the maths alone can't model. Happy to introduce you to an accredited broker to walk through your specific case.