Protect your cashflow with Hire Purchase
Unwilling to spend a large amount of capital on an asset in one go? Our hire purchase facility means you can pay for it in manageable installments, spread over a period of time. A convenient way to buy – with Hire Purchase
Hire Purchase is a simple, well-established way to finance the acquisition of equipment and machinery for your business. You pay an initial deposit, and then the balance and interest through regular
installments.
Hire Purchase/Lease Purchase is a straight forward finance arrangement where you pay for an asset in monthly installments, generally over a fixed period of 24 – 60 months with also a fixed interest rate.
The VAT element of Purchase Price in paid upfront by you, along with any deposit you may also be putting in. You will re-claim the VAT element in your quarterly / monthly repayment. Sometimes there may be a nominal fee / option to purchase fee at the end of the agreement, but this amount is generally modest and always known at the point of signing any documentation.
With Hire Purchase, the asset stays on your balance sheet, the monthly repayments do not attract VAT and any interest charges can be offset against profits for taxation.
Assets you can typically acquire with hire purchase:
- Cars
- Commercial vehicles
- HGVs
- Buses and coaches
- Plant and machinery
- Agricultural equipment
- Construction equipment
- Materials handling equipment
Key highlights:
- Total control – you own the asset at the end of the agreement
- Simple, regular repayments – for easy budgeting
- Choice – you can decide on fixed or variable interest options
- Tax advantages – as well as reclaiming VAT, you may be able to claim capital allowances and also offset repayment interest against profits (special rules apply to cars)
- Flexibility – you choose how the finance is structured: with a flexible deposit, fixed payments and perhaps a balloon final lump sum.
- IT equipment