Forklift Finance UK 2026: Fund New and Used Forklift Trucks Independently

What is forklift finance?

Forklift finance is asset finance applied to the purchase or lease of forklift trucks and material handling equipment. It allows warehousing, logistics, manufacturing and retail businesses to acquire forklifts without paying the full purchase price upfront, spreading the cost over the equipment's working life through fixed monthly payments.

Forklift trucks range from simple electric pedestrian pallet trucks at £3,000 to £8,000, to counterbalance forklifts at £20,000 to £60,000, to large reach stackers and very narrow aisle trucks at £80,000 to £150,000 or more. Fleet operators running 20 or more units across a distribution network can have total forklift asset values exceeding £2,000,000. Finance allows businesses to manage this capital expenditure in line with cash flow rather than absorbing it as a single lump sum.

The forklift and material handling equipment market in the UK is one of the most active secondary markets of any asset class. Major manufacturers including Toyota, Linde, Jungheinrich, Crown, Hyster and Yale produce equipment with well-documented depreciation curves and active resale values. This makes forklift finance straightforward to underwrite and widely available from both bank and non-bank lenders.

Forklift finance products

Hire purchase for forklifts

Hire purchase is the most common product for forklift finance where the business intends to keep the equipment long term. Fixed monthly payments over 36 to 60 months, capital allowances from day one and legal ownership transfer at term end make hire purchase the most straightforward structure for most businesses. The Annual Investment Allowance allows businesses to deduct the full forklift cost from taxable profits in year one under hire purchase.

Hire purchase is particularly suited to electric forklifts where the battery represents a significant proportion of the asset value. Battery technology in modern lithium-ion forklifts has extended the useful life of electric machines, making the ownership model more attractive than it was for older lead-acid battery forklifts.

Finance lease for forklifts

Finance lease is used where the business wants to use the forklift for its full working life without requiring ownership. Rentals are fixed and fully deductible as a business expense. At the end of the primary term, the business can continue on a secondary lease at nominal rent or arrange the forklift's sale and receive most of the proceeds. Finance lease is common for businesses that cycle their fleet regularly and want flexibility at term end.

Operating lease for forklifts

Operating lease is particularly well suited to forklift finance because the secondary market for major-brand forklifts is active and residual values are predictable. The lender takes the residual value risk at term end, which means operating lease rentals are lower than hire purchase or finance lease instalments for the same asset and term. The business returns the forklift at the end of the primary lease period and can refinance new equipment.

Operating lease is also favoured by businesses that need to refresh their fleet regularly to maintain safety compliance and efficiency standards. Modern warehouse operations increasingly prefer newer, more energy-efficient electric forklifts; operating lease makes cycling in new equipment straightforward without the complexity of selling older machines.

Under IFRS 16, most operating leases above a de minimis threshold must now be recognised on the balance sheet for larger businesses. Smaller businesses using FRS 102 apply a different standard. The balance sheet treatment should be considered before selecting operating lease for a large forklift fleet.

Sale and leaseback for forklift fleets

Sale and leaseback is used by businesses that have accumulated an unencumbered forklift fleet and want to release working capital. The business sells the fleet to the lender at current market value and simultaneously enters a lease agreement to continue operating the forklifts. The full market value of the fleet is received as cash and ongoing lease rentals are paid for continued use. This is particularly effective for logistics businesses with large owned fleets valued at £500,000 or more.

New vs used forklift finance

New forklifts from authorised dealers are the most straightforward to finance. The purchase price is the invoice price, the condition is known, and most lenders will finance up to 100 percent of the cost with no deposit required for businesses with good credit profiles. Manufacturer warranties typically cover the first 12 to 24 months, reducing maintenance risk during the early finance period.

Used forklifts are widely financed but require more lender assessment. Age, hours worked, battery condition for electric machines, service history and tyre condition all affect the lender's assessed value and the loan-to-value ratio offered. Portman Asset Finance and Time Finance both have experience financing used material handling equipment and can assess value from standard dealer information.

Refurbished or ex-rental forklifts from major rental companies including Linde, Toyota and Jungheinrich's own used equipment divisions are a common source of quality used machines with known service histories. These are generally easier to finance than privately sourced used equipment because the provenance and maintenance records are clearer.

Electric vs LPG vs diesel forklift finance

The propulsion type of a forklift affects its residual value and depreciation curve, which in turn affects the finance terms available. Electric forklifts have seen improving residual values as demand for zero-emission warehouse equipment grows, driven by both corporate sustainability targets and indoor air quality requirements. Lithium-ion battery electric forklifts in particular hold their value well compared to older lead-acid models.

LPG and diesel forklifts are still financed but face increasing secondary market headwinds as warehouse operators transition to electric. Lenders price LPG and diesel forklift finance with lower residual value assumptions, which can result in higher monthly payments or lower loan-to-value ratios compared to electric equivalents. Businesses acquiring LPG or diesel forklifts should factor in the likely resale value at term end.

Hydrogen fuel cell forklifts are an emerging category with limited secondary market data. Most mainstream lenders are cautious on hydrogen forklifts due to the uncertainty over residual values; specialist or bespoke finance arrangements may be required.

Lenders for forklift finance

Novuna Business Finance (formerly Hitachi Capital Equipment Finance) is one of the largest forklift finance lenders in the UK and operates extensively through dealer and manufacturer vendor finance programmes. Toyota Material Handling, Linde and Jungheinrich all have Novuna-backed finance programmes available through their dealer networks.

Portman Asset Finance provides direct access to forklift finance from £5,000 with same-day decisions for standard applications, making it competitive for both new and used machines. Aldermore Bank covers material handling equipment from £5,000 with published indicative rates. Time Finance provides forklift finance alongside invoice finance, which suits logistics businesses that need both asset and working capital finance.

Nucleus Commercial Finance is the most accessible option for smaller businesses, newer companies or those with adverse credit, with facilities from £3,000 and flexible eligibility criteria.

For a full comparison with FRN numbers, loan ranges and KT Scores, see: Asset Finance UK: The Independent Guide.

Frequently asked questions

Can I finance a used forklift?

Yes. Used forklift finance is available from most specialist asset finance lenders including Portman Asset Finance, Aldermore Bank and Time Finance. The lender assesses the forklift's age, make, model, hours worked, battery condition for electric machines and current market value. Loan-to-value ratios for used forklifts are typically 70 to 90 percent of assessed market value. Portman Asset Finance and Time Finance can issue same-day decisions for standard used forklift applications.

Is operating lease or hire purchase better for forklifts?

It depends on whether the business wants to own the forklift at the end of the term and on its current tax position. Hire purchase gives legal ownership at the end and allows capital allowances from day one, which is advantageous for businesses with taxable profits to shelter. Operating lease gives lower monthly payments, allows the business to return the forklift and upgrade at term end, and means the lender takes the residual value risk. Businesses that refresh their fleet regularly typically prefer operating lease; businesses that run forklifts for 10 or more years typically prefer hire purchase.

Can I finance a forklift fleet?

Yes. Fleet forklift finance is available from most lenders. The facility can cover multiple units under a single agreement or separate agreements per unit. Sale and leaseback is a useful option for businesses that already own a forklift fleet and want to release working capital; the fleet is sold to the lender at market value and leased back under a single agreement. Portman Asset Finance, Time Finance and Close Brothers Asset Finance all handle fleet transactions.

What deposit is required for forklift finance?

For new forklifts from authorised dealers, many lenders will finance 100 percent of the purchase price with no deposit for businesses with good credit profiles. For used or older forklifts, a deposit of 10 to 20 percent may be required. Operating lease typically requires the first and last rental payment in advance rather than a capital deposit. The exact deposit requirement depends on the lender, the asset and the borrower's credit profile.

Do I need to service and maintain a financed forklift?

Yes. Regardless of the finance product used, the business operating the forklift is responsible for its maintenance and servicing. Under the Lifting Operations and Lifting Equipment Regulations 1998 (LOLER), forklifts used at work must be thoroughly examined by a competent person at least every 12 months, or every 6 months if they are used to lift people. Maintenance and service records should be kept throughout the finance term. Failure to maintain a financed forklift in good condition can affect the settlement value and may constitute a breach of the finance agreement.