Financial lease with an option to transfer ownership

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Financial lease with an option to transfer ownership
This type of lease gives you the choice to pay the residual value of the leased asset, thereby acquiring ownership of it, or to waive this right of yours so the asset would remain owned by the leasing company.
In the case of financial lease with an option to acquire the ownership, VAT is charged and paid with each monthly lease installment. Currently, each month the lessor issues an invoice for the due monthly installments, including VAT.
In this type of contract, the option to transfer ownership of the asset from the lessor to the lessee is agreed. For this purpose, what is necessary is:
 
  • Explicit statement of the lessee’s will to exercise the option.
  • Payment, by the lessee, of the value of the option (residual value of the asset).
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