With Lease Purchase agreements (commonly known as Hire Purchase), after all the rentals (payments) have been made including the ‘Option to Purchase Fee’ the client becomes the owner of the asset. For tax purposes, from the beginning of the agreement the client is treated as the owner of the equipment and so may be able to claim capital allowances. The client will be responsible for maintenance and insurance of the equipment.

At the end of a Lease Purchase agreement, the client has an option to ‘buy’ the asset rather than having to return it or sell it onto a third party. With higher value cars we can arrange a final residual ‘balloon’ payment to facilitate lower monthly rentals.

Here are its main advantages:

Optional Balloon payments

Financing luxury/prestige vehicles is very well suited to this type of agreement due to the fact that a ‘balloon’ rental can be arranged at the end of the agreement which can facilitate lower monthly repayments.

Improving Company Balance Sheet

Company assets – Lease/Hire purchase is ideal for companies that want to retain the asset/vehicle as an asset at the end of the agreement, assets best place to buy alprazolam online financed in this way can appear as a balance sheet item and you can write down the value against taxable profits.

Cash Flow

Purchasing assets outright can put a strain on cash flow but with lease purchase you can spread the cost of the asset over a set term based on the life of the asset.

Ownership of the asset

Once any Option to Purchase fee and/or Balloon payment is made, the asset/vehicle becomes your property.


With fixed interest rates and monthly payments, hire/lease purchase agreements help businesses when forecasting cash flow. The business is able to compare the payments with the expected revenue and profits generated by the use of the asset.

Reclaimable VAT

For assets used for business purposes the total VAT can be reclaimed if the client is a VAT registered business.

For more information regarding Lease Purchase or any of our products, please speak to your Account Manager or contact the sales team.

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