This template should be used where some of the chattels and equipment belong to the owner/lessor outright and some are owned by a third party from which it is leased or is subject to retention of title clause pursuant to a hire purchase or finance agreement.
A chattels lease can be used to allow flexibility within a group of companies' activities where there are several different businesses being conducted. For example, a company that does landscaping may have another group company that does earth moving or provides soil, turf, gravel etc. or which sells plants or runs a nursery. Quarantining the major chattels assets such as trucks, earthmovers, tractors etc. may not only have asset protection advantages but also allows a more flexible base for use.
Chattels leases are also often used as part of asset protection planning and you should consult your lawyer and/or accountant to discuss how to use a chattels lease in your particular circumstances and what steps you should put in place.
There may also be important tax implications relating not only to income revenue but to capital gains, and therefore having chattels leases in place may be relevant for your exit/retirement strategy. For example, you may wish to keep the company which owns all the equipment and continue to lease that equipment to the business/es you have sold to give you passive income in your retirement.
LAWLIVE recommends: This is a complex document which involves the creation of complex legal rights and obligations and may give rise to various taxation and liability consequences. The best way to use this document is to complete it, print it out, print out all of the checklists that apply to it and all other LawLive information that relates to this type of document. When you have done this, LawLive recommends you read it carefully and instruct lawyers to assist you in the finalisation of the document and that you take tax advice from your accountant or tax adviser as to any income tax, capital gains or GST consequences.