Hire Purchase is a simple and effective way for private individuals and businesses to spread the cost of a new or used vehicle.
Pay a small deposit (10-20%) to suit the available capital, and then make monthly repayments over an agreed period of time (24/36/48/60 months). Once all the payments have been made you own the vehicle.
If you are a business user, all of the interest on your payments is allowable against tax, additionally a proportion of the vehicle value can be written down against your profits.
Advantages of Hire Purchase
1. Eventual ownership & control of usage and disposal
2. Eases cash flow, budgeting and planning & known outlay that will not change
3. Leaves other credit lines undisturbed
4. Interest charges allowable against taxable profits for business users
5. Tax relief (capital allowances) & reduces tax bill for business users
6. Capital released & leaves money available to develop other parts of the business