Lease Calculator
Calculate the monthly payment for leasing equipment, vehicles or any other asset based on the capitalized cost, residual value and money factor.
How to use the Lease Calculator
- Enter your inputs into the Lease Calculator above.
- Results update instantly as you type — no submit button needed.
- Adjust any value to see how the result changes in real time.
The lease payment formula
Payment = (Cap cost − Residual) / Term + (Cap cost + Residual) × MF
The depreciation portion is the value used up divided by the term. The finance portion uses the money factor on the average of cap cost and residual. Total before tax.
Worked example
A $60,000 piece of equipment with 30% residual ($18,000) leased for 48 months at money factor 0.0030: depreciation = ($60,000 − $18,000)/48 = $875; finance = ($60,000 + $18,000) × 0.0030 = $234. Monthly: $1,109 pre-tax.
Frequently asked questions
When is leasing better than buying?
Leasing is typically better when the asset depreciates rapidly, when you want to upgrade frequently, or when the tax treatment of operating leases is advantageous (consult an accountant).
What is a closed-end vs. open-end lease?
Closed-end (most consumer leases): walk away at end of term, you owe nothing if residual was correct. Open-end (some commercial): you cover any shortfall if the asset is worth less than residual.
Are lease payments tax-deductible for business?
Often yes, for the business-use portion. Operating leases for equipment and vehicles typically generate fully-deductible expense. Consult a tax professional for your specific case.