Break Fees, and What Actually Triggers Them
Last updated: September 2026
A break fee is what you pay to end a printer lease before its term finishes.
It is normally based on the payments still owing rather than a flat penalty.
The shorter the time left, the smaller the figure.
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Quick formHow the figure is built
The starting point is almost always the remaining payments across the rest of the term.
Some agreements discount those remaining payments, because the financier receives the money earlier than expected.
The condition of the device can affect the final settlement, which is where fair wear and tear matters. Fair wear and tear means the marks and deterioration expected from normal office use, as opposed to damage.
Where the device is being replaced with another agreement from the same supplier, part of the figure is sometimes absorbed into the new arrangement.
When ending early is still the cheaper decision
A device that no longer suits the office has a cost of its own, paid every day in slower work and staff time.
If the remaining term is short, the break figure is often lower than people expect, and lower than another two years on the wrong machine.
Where the business is closing or being sold, an early settlement may be unavoidable, and the business closure page covers that separately.
Triggers, and things that look like triggers
- Ending the agreement before the term finishes triggers it.
- Upgrading mid term usually does not trigger it in the same way, because the remaining obligation is commonly rolled into the replacement agreement.
- Returning the device at the natural end of the term does not trigger it at all.
- Falling behind on payments is a different matter and is dealt with under the default provisions rather than as a break fee.
Getting the number before you decide
Ask the financier for a written settlement figure with a date it is valid until. Verbal figures move.
Ask separately what the figure would be if the device were replaced rather than simply returned. Those two numbers are often different.
This page describes how equipment finance generally works in Australia. It is general information, not legal or financial advice, and your own agreement governs your position.
Common questions
How is a printer lease break fee calculated?
It is normally based on the payments remaining across the rest of the term, sometimes discounted because the financier receives the money earlier than expected.
Device condition can affect the final settlement.
It is not usually a flat penalty.
Can I avoid a break fee by upgrading instead of exiting?
Often, yes.
Upgrading mid term commonly rolls the remaining obligation into the replacement agreement rather than settling it as a separate fee.
Ask for both figures in writing before you decide.
What is fair wear and tear on a leased printer?
Fair wear and tear means the marks and deterioration expected from normal office use over the term.
It is distinct from damage, missing parts or neglect, which can be charged separately at the end of the agreement.
Is a break fee the same as defaulting on the lease?
No.
A break fee applies where you choose to end the agreement early and settle it.
Falling behind on payments is handled under the default provisions of the contract, which are separate and carry different consequences.