On the other side of the Balance Sheet to the above, Succession Capital has an asset finance arm which rents assets to users of those assets.
Some of the significant benefits to the lessee are that:
- The entire rental payment is tax deductible
- Their balance sheet is positively re-structured
- The payments to the rental company can be accredited to BEE procurement points
- The sale of the assets to the rental company can provide BEE ownership points to the selling entity into perpetuity
Other structuring mechanisms, for eg: S12J companies, can also be employed to minimise financing costs through the chain.
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