SEC Payment on Bank of Ireland Finance Statement

Just got some to see a statement equipment I have leased from Bank of Ireland had arrived (first one in two years). Everything is in order in relation to amounts paid, etc but I see at the last month of payments there is a description of SEC repayment and then exactly a year later another SEC repayment?

can anyone explain what it is? As my lease is for 5 years after which I want to sell the equipment I'm curious as to know I have a value to repay in to my sixth year this amount? Is it to extend the period? Confused.

having done a bit more research there is an option for a secondary payment on the equipment. I believe this is optional?
What are the advantages of extending the lease for another year for a customer?
I see that the customer can buy the equipment outright for the market value of the goods. Is this a nominal amount and is it judged based on amount paid off already, etc? I note you can dispose using a leased asset disposal company form. Search online for this is yielding little or no information.

Any help/advice would be greatly appreciated.

MidlandsBase said:

Just got some to see a statement equipment I have leased from Bank of Ireland had arrived (first one in two years). Everything is in order in relation to amounts paid, etc but I see at the last month of payments there is a description of SEC repayment and then exactly a year later another SEC repayment?

can anyone explain what it is? As my lease is for 5 years after which I want to sell the equipment I'm curious as to know I have a value to repay in to my sixth year this amount? Is it to extend the period? Confused.

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sounds like a secondary lease payment, a small payment maybe around 120 euro once a year, pay it each year or

lease asset disposal
get finance company to terimate lease(normally small value)- they will give you a invoice and credit note- use these in vat and tax comp(rebate of rentals)

when finally yours-claim capital allowances on it

Hi feltox, many thanks for your response. Why would people extend for another year? what advantage is there?
Will the invoice at the end also be for a nominal amount or does it relfect starting amount and amounts paid giving the difference 9which would be zero if all amounts paid?).

MidlandsBase said:

Hi feltox, many thanks for your response. Why would people extend for another year? what advantage is there?
Will the invoice at the end also be for a nominal amount or does it relfect starting amount and amounts paid giving the difference 9which would be zero if all amounts paid?).

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The payment is small and they extend for another year. If the rebate of rentals value is high it is taken into your tax computation and you could be paying high tax on it. The extra year brings down the value more but at five years the value might be pretty low already

it is like addback some of the lease payments you are already got a deduction for.

i think at end may just go at market value which is normally very small, they have made their money on the 5 years repayments

bigger effect if asset significant value

Thanks Feltox. The equipment is for catering equipment and furniture so not that high value. I have been told I can buyout the equipment before the end as well. I presume that means I could own the equipment out right even before the end of the lease if I wanted to sell and buy new equipment?