Your default option when providing equipment to remote and hybrid workers: purchasing it. And purchasing equipment obviously makes sense for long-term use. But beside that, renting has financial, health and safety and operational advantages over buying that are worth considering.
Below, we outline the main considerations for renting and purchasing equipment, and why Hofy’s Rent to Own policy maximises the benefits of both.
Office equipment that's purchased is a capital expense. That means you are required to track it on your balance sheet and insure it.
Rental of home office equipment, on the other hand, is an operating expense. So there's no need to track it on your balance sheet.
If you gift equipment to remote workers - either upon purchase, or when they leave your organisation - you may need to report it on the employees' payroll, and tax return that a gift of a certain value was given to the employee. Employees then may face income tax and national insurance charges on the value of the equipment.
In a rental situation, the lessor owns the equipment during, and at the end of, the contract. That means no payroll reporting duties, and no tax risk for team members.
The bottom line: Renting involves less financial admin and no tax risk for team members.
If you purchase and retain ownership of the equipment you provide your teams with, you are responsible for the upkeep. The exact nature of your responsibility will vary by jurisdiction. For example, in the UK, the Provision and Use of Work Equipment Regulations (PUWER) require employers to ensure equipment is “maintained in an efficient state, in efficient order and in good repair”.
You should read up on local requirements to ensure you are meeting your H&S compliance duties surrounding equipment maintenance.
If you rent equipment, the lessor owns the equipment, and therefore takes on this responsibility.
If an employee sustains an injury during, or due to, incorrect assembly of equipment you have purchased, you may be liable for an insurance as a result of your duty of care to provide a safe working environment for remote workers. For this reason, you may wish to take out insurance to cover your liability.
In a rental situation, the lessor takes on this liability.
The bottom line: Renting spares you H&S and insurance liability risk.
Contractors are expected to use their own tools for the job. In most jurisdictions, a contractor that uses company-owned equipment would be deemed an employee. And so purchasing equipment for a contractor runs the risk of misclassification.
If you rent equipment, the lessor owns the equipment. As the contractor is not using company-owned equipment, and the rental can be treated as a business expense, the risk of misclassification is significantly lower.
The bottom line: Renting reduces the risk of misclassification.
Hofy operates on a subscription basis. You pay one monthly fee for your entire organisation, which includes your platform fee, all equipment rentals and any add on services.
However, renting from Hofy does not rule out the possibility of keeping items long-term. We give you the option to purchase and own the equipment under our Rent to Own policy.
Your equipment depreciates over the course of your rental. Once the equipment has fully depreciated, you are spared the financial reporting and tax implications of purchasing new.
So Hofy’s Rent to Own policy gives you the convenience of a rental when the equipment is new and worth a lot, and the longevity of a purchase once the equipment has depreciated.
Rent for an initial term of 6, 12, 24 or 36 months. When your contract is up, you can either:
If you want to own the equipment, you just need to pay a small fee and it’s yours to keep.