Can installation, tooling, software, and training costs be included in asset finance?
Yes — many UK asset finance agreements can include installation, tooling, software and even training
In the UK, many lenders will fund “soft costs” alongside the primary equipment being purchased, including installation, delivery, tooling, software licences and, in some cases, training. The level of inclusion depends on the finance product, the lender’s policy, and how clearly these costs are itemised and linked to the asset. Training is the most restricted category, but it can sometimes be included when it is essential to commissioning and safe operation.
Below, we explain what’s typically fundable, how different products treat soft costs, what evidence lenders may ask for, and practical steps to structure a compliant proposal. This guide is for established UK businesses and is information only, not financial advice.
What exactly can be included as “soft costs” in asset finance?
Asset finance usually covers the core asset plus reasonable associated costs that are required to make it work from day one. Lenders call these associated items “soft costs” or “ancillary costs.” These amounts are commonly included up to a percentage cap against the total package.
Acceptability varies by lender, sector and asset type, so it is important to present a clear, itemised quotation that links each soft cost to the equipment’s installation and operation. Where costs are not allowable, a separate funding route may be more suitable.
Installation and commissioning
Installation, delivery, rigging, calibration, factory acceptance testing (FAT) and site acceptance testing (SAT) are commonly included. Commissioning by the manufacturer or an approved engineer is often seen as integral to the asset’s value and use.
Many lenders allow full inclusion of installation when the supplier invoice clearly itemises these services and ties them to the equipment serial numbers or bill of materials. Evidence such as commissioning certificates may be requested post-delivery.
Tooling, accessories and setup
Tooling, jigs, fixtures, guards, consumable starter packs, racking or workholding that are necessary to operate the machine are routinely included. Optional accessories are typically acceptable if they are supplied and invoiced with the main asset.
Where multiple suppliers are involved, lenders may still include the costs but will usually require cross-referenced quotations and a single payment flow they can control. Consolidated invoicing can speed approval.
Software, licences and digital integration
Software that enables or controls the asset — such as CNC controllers, PLC programming, HMI, MRP/ERP interfaces, or machine monitoring — is often included. Perpetual licences bundled with the hardware are easiest to finance.
Subscription or SaaS licences can sometimes be included for an initial term when they are essential to the asset’s use, but many lenders cap or exclude recurring fees. Stand‑alone software can be financed via specialist “software finance,” unsecured term loans, or technology leasing.
Training, onboarding and certification
Training is the most restricted category but may be included when it is mandatory for safe operation, required to validate warranties, or necessary to meet regulatory compliance. Train-the-trainer packages and certification courses may be considered case-by-case.
General staff training unrelated to the asset is usually excluded. If training cannot be included, a separate working capital or unsecured loan may be used to cover the cost.
Common exclusions to be aware of
Pure consultancy, business-as-usual training, long-term SaaS beyond the asset warranty, and unrelated building works are frequently excluded. Civil works, power upgrades and mezzanines may be included only where they are integral to the machine’s install and resale value.
If in doubt, present a clear narrative linking each cost to the asset’s acquisition, commissioning and compliant operation. Lenders want a fair, transparent rationale.
How do different asset finance products treat these costs?
Soft-cost policy differs by product. In general, hire purchase offers the most flexibility, finance leases sit in the middle, operating leases are more restrictive, and asset-backed loans depend heavily on valuation and security.
The right choice balances cash flow, VAT treatment, ownership objectives and the blend of hard and soft costs in your package. Always check lender criteria before committing.
Hire purchase (HP)
HP often allows the broadest inclusion of installation, tooling and embedded software because ownership passes at the end. Many lenders accept 10%–30% soft costs without issue, with higher allowances considered case-by-case.
VAT can be deferred under some HP facilities, which may help cash flow on large installations. Training may be included if essential to commissioning and warranty validity.
Finance lease
Finance leases typically permit soft costs closely tied to the asset, especially installation and accessories supplied at point of sale. Software linked to the machine may be included if it has ongoing value with the hardware.
Recurring software subscriptions and broad training packages are less likely to be included. End-of-term options vary, so consider asset lifecycle and residual value.
Operating lease
Operating leases are stricter because the funder relies on residual value at term-end. Soft costs that do not enhance resale value are commonly excluded or capped lower.
Delivery and installation may be allowed where they form part of the returnable asset’s value proposition. Training is rarely included in operating leases.
Asset-backed loan or refinance
Refinance or asset-backed loans are secured against existing assets and hinge on valuation. Soft costs that have already been incurred are typically not funded unless they demonstrably add to tangible resale value.
Refinance can be paired with a separate working capital facility to cover training or software that cannot be securitised. Ensure valuations reflect any embedded controls and licences.
Evidence lenders may ask for
- Itemised supplier quotations and pro formas tying costs to the asset
- Commissioning plans, training outlines and warranty conditions
- Software licence terms, version details and duration
- Multi-supplier payment instructions and delivery milestones
Typical soft-cost caps and treatment
- Installation/commissioning: often allowed in full if integral and itemised
- Tooling/accessories: usually allowed, especially if invoiced with the asset
- Software: allowed if embedded or perpetual; subscriptions capped or excluded
- Training: limited; allowed when essential to safe, compliant operation
Which sectors benefit — and what does a compliant package look like?
Manufacturing, engineering, construction, healthcare, logistics, hospitality and retail frequently include soft costs in asset finance. Lenders value clear, audit‑ready quotations with a logical link between each cost and asset usage.
Below are practical examples of how businesses structure packages that stand up to lender scrutiny and keep projects moving.
Manufacturing and engineering
For CNC machines, presses and fabrication lines, installation and tooling are critical. Software for CAM, PLCs and machine monitoring can be included when bundled with hardware.
Training that validates warranty or ISO/CE compliance may be allowable with the commissioning line. For sector guidance, see our engineering finance options here: engineering business loans.
Construction, HVAC and fit-out
For plant and M&E equipment, delivery, rigging and on-site commissioning can be included. Bespoke attachments, safety systems and telemetry are commonly funded.
Software for fleet tracking or BIM integration may be partly included when tied to the asset, though recurring licences are often capped. Toolbox talks are usually excluded unless mandated for operation.
Healthcare and care homes
Medical devices often require OEM installation, validation and training. These costs are more likely to be accepted because they are essential to regulatory compliance.
Software modules for imaging or EPR integration can sometimes be included, especially perpetual licences. Clinical training beyond device-specific onboarding is typically excluded.
Retail, hospitality and EPOS
EPOS terminals, kitchen equipment and display systems can include installation, cabling and configuration. Payment software and integrations may be included up to a limit.
Staff training for customer service or general operations is rarely included. Consider a separate working capital facility for broader training needs.
Software + hardware bundles
Where software unlocks the hardware’s functionality — e.g., ERP terminals, robotics control, vision systems — lenders are more open to inclusion. Perpetual or multi‑year licences bundled at purchase are best.
Pure software or SaaS-only projects can still be financed via specialist lenders, but the product may be a technology lease or unsecured business loan rather than traditional asset finance.
What a strong asset package looks like
- A single project scope: equipment, installation, tooling, software, onboarding
- Itemised costs with supplier references and serial numbers
- Clear commissioning plan and any mandatory training statements
- Split of hard vs soft costs and identification of any recurring items
What are your next steps? FAQs, eligibility and how Best Business Loans helps
Best Business Loans is an independent introducer that helps UK companies explore suitable funding providers. We do not supply loans directly, and we don’t offer regulated financial advice.
Our AI-driven process quickly matches your requirement to lenders and brokers who are active in your sector and comfortable with the blend of hard and soft costs in your project. All finance is subject to status, approval and lender criteria.
How to prepare your enquiry
- Define the assets and outcomes: what you are buying, why, and by when
- Gather itemised quotes: separate installation, tooling, software and training
- Add supporting documents: floor plans, commissioning steps, licence terms
- Note any grants or deposits: and whether you need VAT deferral options
Steps to explore funding
- Complete a Quick Quote with project details and estimated budget.
- Our system matches you to providers aligned to your asset type and sector.
- Discuss soft-cost inclusion and structure with the matched provider(s).
- Compare terms, review obligations and proceed only if it suits your cash flow.
FAQs
Can training costs be included in asset finance?
Sometimes. If training is mandatory for safe operation, warranty validation or compliance, some lenders will include it when itemised with the asset. General staff training is usually excluded.
Will lenders include software and licences?
Yes, when the software is essential to the asset and ideally perpetual or bundled at purchase. Recurring SaaS fees may be capped or excluded, and pure software projects often use specialist technology finance instead.
What about installation and commissioning?
Installation, delivery, commissioning and acceptance testing are commonly included because they make the asset usable. Provide itemised supplier documentation to support inclusion.
Are there caps on soft costs?
Many lenders set soft-cost limits, for example 10%–30% of the total financed amount, though higher levels can be approved case-by-case. Product type and asset resale value influence the cap.
Can I finance from multiple suppliers?
Yes, but lenders usually require coordinated paperwork, payment control and consistent milestones. Consolidating invoices through a prime contractor can simplify approval.
How is VAT handled?
VAT treatment varies by product. Under HP, some lenders offer VAT deferral at the outset, while leases typically charge VAT on each rental. Always confirm VAT handling before signing.
Compliance and transparency
- Information provided is for general guidance and does not constitute advice.
- Finance availability and terms depend on eligibility, sector and lender policy.
- Please ensure any decision is based on full terms, costs and your own circumstances.
Key takeaways
- Installation, tooling and embedded software are often includable in asset finance.
- Training may be included when essential to commissioning, safety or warranty.
- Soft-cost caps apply and vary by lender and product type.
- Clear, itemised documentation increases approval likelihood and speed.
- Where items are excluded, pair asset finance with working capital or software finance.
Start your finance journey
Best Business Loans helps established UK businesses connect with lenders and brokers who understand your sector and funding needs. It’s fast, secure and free to submit an enquiry.
Check your eligibility and get matched to suitable providers for your asset and soft-cost mix. There is no obligation to proceed, and you stay in control throughout.
Get Your Free Quick Quote Now — subject to status and lender criteria.
About Best Business Loans
BestBusinessLoans.ai is an independent introducer. We connect UK companies with suitable finance providers; we do not provide loans or credit decisions. We do not support start-ups, sole traders, franchises, property finance or commercial mortgages.
Fair, clear and not misleading
We aim to ensure all information is accurate, balanced and up to date, and that significant limitations or exclusions are highlighted. Always read full terms and costs provided by any lender before committing.
Updated: October 2025