Lease Query

At the end of primary leasing period, the lease provider sends a letter with two options.

1. Pay the secondary period rental of say €200 per month plus VAT
2. Discontinue further payments and become the legal owner of the asset (no payment required)

Why would you pick option 1?

The secondary rental period is usually the equivalent of one month's rent of the first period - €200 per month seems high although obviously it depends on the original cost of the asset in question.

Personally I don't really see the benefits of continuing to rent the asset although there could be issues like if the assets breaks down then the lease company is obliged to repair it or replace with a similar model or other stuff like that - you'd have to read the T&C of the lease agreement

Most people seem to go for second option. I wasnt sure if I was missing something.

Thanks for the reply.

Can't remember the details but Option 2 has VAT implications. Get some professional advice before you jump for either option.