Sell and lease back is where the seller wishes to sell the property and again lease it for a long period. He will continue to live in that property but however he is not the owner of it nor does he possess the same. This may be usually done for the tax reasons and auditing purposes. It is mostly done in the case of fixed assets. It is an arrangement where one person sells his property to another and immediately leases the property back to the person who sells it. The buyer will however have full possession of the property though not having principal bind up with the property. Lease Back always helps and provides in tax benefits.
Once the seller sells the property he wishes to enter into a long term lease agreement. The reasons for such sell and lease back are to ascertain the constant value of the property and its profit. Moreover this helps in long term safe venture. It also helps in tax and other accounting purposes.

Sell and lease back is also done between the banks and the state. It helps the banks to attract the losses in those assets broken over years. Sell and lease back provisions are common in America, London and France. It is now becoming popular in Australia too. Sell and lease back is familiar in the commercial field where corporate sell fixed assets and later lease it for long term for their office purposes. One reason for a leaseback is to reassign possession to a investment business while keeping appropriate mode of the current value and effectiveness of the property. Another is for the seller to lift funds by relieving the priceless asset to a purchaser that is most probably concerned in making a long-term protected venture.

Sale and lease back have some advantages like helping in pay arrears and maintain the company’s profit and loss and trial balance, it helps in decreasing the tax accountability and also helps in reducing all rental payments on the yearly tax returns, it also helps in extending the business, entering into new projects and new business dealings.  It is also a great advantage for the land owner where they lease it for the long term and will have a fixed income, he will have a fixed investment in the way of rent and the depreciation value of the property will be dependable on the tenant.  It also helps in income tax purposes. Thus sale and lease back is a good deal in the developing commercial world in recent years  but it is always better to consult an agent or real estate broker, lawyers and auditors or accountant before going in for the deal of sell and lease back. One reason for the company to sell and lease back property is to raise capital value to support the corporate activities. All leaseback companies will say not to bind up money in the real estate business because the property returns will reduce to less than 10 percent every time.