There are no restrictions on a company's financial operations, as loans often impose. Payments are spread out for a longer period than loans permit, thus involving lower monthly payments. Protection against the risk of equipment obsolescence is automatic because the lessee disposes of the equipment at the end of the lease. There are income tax benefits. Lease payments are fully deductible as operating expenses if the agreement is a true lease.
Accounting is easier.
The lessor handles most of the accounting and paperwork, relieving the lessee of the administrative details of recordkeeping. The lessor also has responsibility for complying with state regulations and completing and filing required forms. There are sales tax benefits. That can be a beneficial tax break when the leased property is traded in before it is fully depreciated, because the lessee will have paid only a portion of the total sales tax. The lessor will usually have experience with the equipment and can provide expert technical advice.