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How Canadian businesses can plan IT refresh cycles and get tech equipment leases approved faster, with smarter structures and less strain on cash flow.
If your laptops, servers, and network gear are older than your junior staff, you don’t have a “tech problem” — you have a financing and planning problem.
In Canada, most businesses now refresh core IT gear roughly every 3–5 years, especially as AI-ready devices and the Windows 10 end-of-support deadline push upgrades. Leasing lets you turn those lumpy, stressful upgrades into predictable, pre-approved refresh cycles instead of last-minute panics.
This guide walks through:
Key point: Devices are lasting longer technically, but security, software support, and AI workloads are pushing Canadian businesses toward more deliberate refresh cycles, not “run it until it dies.”
A few big forces are colliding:
On the finance side, Canadian commercial credit data from the Canadian Finance & Leasing Association (CFLA) and Equifax show rising equipment lending volumes, particularly for modernization and productivity upgrades by SMEs.
Put bluntly:
Leasing through a specialist like Mehmi — via equipment leases or a revolving equipment line of credit — lets you align finance with that reality instead of fighting it.
Key point: You don’t need lab-grade precision, but you do need a rough refresh policy for each category, because that’s what drives term, residual, and approval logic on your leases.
Here’s a practical, Canadian-market view based on industry norms and analyst guidance:
<table>
<thead>
<tr>
<th>Asset type</th>
<th>Typical refresh cycle</th>
<th>Common lease term</th>
<th>Notes</th>
</tr>
</thead>
<tbody>
<tr>
<td>Laptops & mobile PCs</td>
<td>3–4 years</td>
<td>36–48 months</td>
<td>Faster refresh in security-sensitive or dev roles.</td>
</tr>
<tr>
<td>Desktops & workstations</td>
<td>4–5 years</td>
<td>48–60 months</td>
<td>High-end graphics/engineering often closer to 3–4 years.</td>
</tr>
<tr>
<td>Servers (on-prem)</td>
<td>4–6 years</td>
<td>48–60 months</td>
<td>Hardware life longer, but OS/support cycles matter.</td>
</tr>
<tr>
<td>Networking (switches, Wi-Fi)</td>
<td>5–7 years</td>
<td>60 months</td>
<td>Often kept a bit longer if performance is adequate.</td>
</tr>
<tr>
<td>POS, kiosks, terminals</td>
<td>3–5 years</td>
<td>36–60 months</td>
<td>Retail/hospitality turnover plus physical wear.</td>
</tr>
<tr>
<td>Phones, conference gear</td>
<td>4–6 years</td>
<td>48–60 months</td>
<td>Cloud telephony can change the equation.</td>
</tr>
</tbody>
</table>
Most IT-focused lessors design standard terms between 12 and 60 months to match these lifecycles.
Your refresh policy doesn’t need to be perfect. It just needs to be:
That’s enough for a lender — and your own leadership — to treat IT refresh as a planned program, not a constant emergency.
Key point: The trick is not “cheapest rate,” it’s choosing terms and end-of-lease options that match how long you’ll actually keep the gear.
For IT, two structures dominate:
Most providers (and Mehmi) can do both inside a broader equipment financing strategy.
FMV leases usually:
They’re a strong fit for:
At the end of term you typically:
The catch is vague contracts. You want clear language around how FMV will be set, not “at lessor’s sole discretion.”
Fixed-buyout or “$1” leases behave more like a loan:
They work well for:
Often the smartest move is a mix: FMV on endpoints, fixed-buyout on core infrastructure, all inside one overarching facility or equipment line of credit.
Key point: For technology, lenders care less about the brand of laptop and more about cash flow, time in business, and a believable refresh plan. Get those right and approvals get much easier.
Public guidance from BDC’s technology equipment loan and equipment financing pages highlights a few recurring themes:
For an IT leasing request, a Mehmi-style underwriter will usually look at:
The good news: compared to heavy construction or specialized industrial assets, IT is often easier to underwrite, because lifecycles and resale markets are well understood.
Key point: You’ll get faster approvals and better structures if you pitch your IT leasing as a program with rules, not a string of one-off panic purchases.
Here’s a simple playbook you can adapt.
You don’t need fancy tooling. Start with:
Tie each line to a business pain: downtime, slow staff, security exposure, compliance issues.
For each bucket (endpoints, POS, servers, network):
Write it down as a short internal policy. Lenders love seeing this — it shows you’re proactive, not reactive.
Rather than begging for each batch:
BDC explicitly recommends presenting a clear written proposal explaining why you need the equipment and how it will impact your operations when seeking equipment financing. That same approach works with Mehmi: you’re asking for a program, not a toy.
Not everything tech-related belongs in an equipment lease. As a rule of thumb:
Leasing too much “squishy” spend confuses everyone — including CRA and your auditors.
IT refresh touches:
If you build a cross-functional sign-off before you go to the market or to Mehmi, approvals tend to fly through instead of getting bogged down at the last minute.
Key point: In Canada, computer and IT equipment lease costs are usually deductible as you go, which often fits the short life of tech better than slow CCA on owned assets. But tax should support your strategy, not drive it.
CRA’s guidance on computer and other equipment leasing costs and general leasing costs says:
If you buy instead of lease:
The contrarian view:
“Don’t choose leasing just for tax —
use tax to support the cash-flow and refresh strategy you actually need.”
In practice, Mehmi will often:
The goal is a structure that keeps CRA happy and makes sense for your security, support, and cash flow.
Key point: Once you get past one-off deals, you can cut cost and friction by setting up standing facilities and recycling capital in older gear.
Instead of negotiating every time you buy 20 laptops:
This feels more like a “renewable tech budget” than a series of individual leases, and it can dramatically speed up approvals for each wave.
If you’ve paid cash for servers or built out a small data centre, there may be capital locked up in that hardware. A refinancing or sales leaseback can:
CFLA and federal small business financing rules explicitly recognize capital leases for new and used equipment as a tool for providing necessary equipment to small businesses.
If you buy most of your gear from one or two vendors, a formal vendor program with Mehmi can:
That’s especially powerful for MSPs, software firms, and franchise systems that want a repeatable, “plug-and-play” way to put standardized IT in multiple locations.
Key point: Leasing is great for hardware and some soft costs, but a full tech program usually needs working capital as well. You don’t want to max out your operating line on laptops.
In a healthy capital stack, you might use:
Used well, that mix:
Mehmi’s team can walk through your plan, then plug options into their FAQ resources and modelling tools so you see how leases and loans work together.
Background
A 120-person engineering and consulting firm based in Ontario had:
IT wanted to move to AI-capable laptops and tighten security. Finance wanted … not to blow up cash flow.
Old way: one-off scrambling
Historically, they:
Result:
New way: program-based leasing with pre-approved refresh
Working with Mehmi, they:
Approvals and execution
Because the program was structured coherently, Mehmi’s credit team could approve the full multi-year facility up front, rather than re-underwrite each small batch. The firm then:
Results after 18 months
The CFO’s verdict:
“We didn’t just get cheaper laptops —
we got a system for staying current without choking our cash.”
1. How often should a Canadian business refresh laptops and desktops?
Most organizations aim for 3–4 years on laptops and 4–5 years on desktops, in line with analyst guidance that balances performance and cost. Security, OS support (e.g., Windows 10 end of support), and user productivity are now just as important as raw hardware life. Critical roles (developers, traders, designers) may need faster cycles.
2. What lease term works best for IT hardware?
Common terms for IT leases in Canada are 24–60 months, with many IT-focused lessors standardizing on 12–60 months to align with asset lifecycles. A good rule: keep lease term at or slightly under your planned refresh cycle. For example, 36 months on laptops if you plan a 3-year refresh, and 48–60 months on core infrastructure you’ll keep longer.
3. Are IT lease payments tax-deductible in Canada?
Yes, usually. CRA says that if you lease computers or other equipment, you can deduct the portion of lease costs that reasonably relates to earning business income, and more generally, you deduct lease payments you incur in the year for business property. If you bought the same equipment instead, you’d typically claim CCA over time instead of expensing the full cost immediately.
4. What do lenders look at when approving an IT lease?
They look at your time in business (often 12+ months), revenue and profitability, credit history, and how the equipment fits your operations. BDC and other Canadian lenders emphasize providing recent financial statements and a clear written proposal explaining why you need the equipment and how it benefits the business. For IT specifically, a documented refresh plan and standardized hardware stack can significantly speed approvals.
5. Can I bundle software and services into an IT equipment lease?
Often, yes — within reason. Many lessors will finance certain “soft costs” such as installation, configuration, and perpetual licences as part of the total project cost, similar to how equipment loans can cover up to 125% of asset cost to include shipping and training. However, recurring SaaS subscriptions and purely consulting-type services are usually better funded through working capital or term loans. Mehmi can help decide what goes into equipment financing versus business loans.
6. How can I speed up approvals for recurring tech refreshes?
Treat IT as a program, not a series of emergencies. Build a 3–5 year refresh roadmap, standardize hardware, and work with a partner like Mehmi to set up a revolving equipment line of credit or master lease so each batch of devices is just a draw on an existing facility. Combine that with clean financials and tax-aware structuring, and approvals usually become routine rather than painful.
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