PURCHASE / LEASE PURCHASE
traditional method of funding that allows you to spread the
cost of goods over the period with ownership transferred to
you at the end of the agreement.
You own the goods at the end of the agreement.
You can claim back the VAT on the cost of the asset.
Tax relief is claimbable on the interest payments and you can
also claim capital allowances.
Hire Purchase is treated as an outright purchase for tax purposes.
traditional method of finance where by the leasing company (LESSOR)
buys the goods and then rents them to you (LESSEE) for a fixed
This means that:
Rentals can normally be off-set against profit for tax purposes.
VAT is reclaimable on rentals.
Continuation periods possible.
of acquiring goods without the problems of ownership.