(Submitted by Gareth Stevenson) When leasing a copier or multifunction device (MFD), depending on the dealer or the service package that you agree to, additional charges may sometimes apply. Listed below are some of the additional charges that you may see on your service contract:
- Administration Fees
- Transitional Billing
- Property tax
- Toner Shipment Fee
- Administration Fees If you lease your copier, then there may be a one-time documentation fee from the leasing partner. This fee covers the administrative duties related to setting up your lease account. These fees can vary from $75.00 to $150.00. If you purchase your copier, then this fee would not apply.
- Transitional Billing This charge is determined by the date that your vendor bills you monthly. The charge includes the prorated monthly amount up to the billing date plus your first month’s contracted amount. This is a one-time charge occurring when you first transition over to a new lease and will result in your initial bill amount being higher than the agreed contract amount.
- Property Tax Because the MFD is a tangible asset, property tax is applicable if your business is registered as a for-profit organization. If, however, your business is registered as a non-profit organization, then property taxes would not be applicable. For specific information on this, we recommend contacting your tax professional.
- Toner Shipment Fee Due to the increased charges for processing, shipping, and handling of supplies, there may be additional shipping fees associated with delivering toner promptly. These fees can vary by organization and could be applied in one of the two following ways: • A flat monthly fee averaging between $10.00/month – $15.00/month. • A shipping fee determined by calculating a per print/copy cost, ranging from $0.0005 – $0.0009.
Whether you purchase or lease a MFD, you will want to ensure that the asset is protected so that you are covered in the event of any unforeseen accidents or disasters. 95% of MFDs are leased by organizations with the copier being a tangible asset owned by the leasing company, who will want to ensure that their asset is protected. Therefore, on your first bill you might receive an insurance offer from the leasing company. The price for the coverage offered could range between $17.00 – $25.00 per each device.
Please note that you do have the option to decline the leasing company’s insurance in lieu of placing the MFD under your own business insurance. If you choose this option, then most leasing companies will ask for proof of insurance to ensure that the asset is protected.
If you opt to purchase a device, then you may still want to ensure that you have your asset protected under your own business insurance.
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