Hire Purchase is a great solution for all sizes of businesses that want to purchase assets such as new machinery, IT equipment, vehicles and other equipment, but would rather spread the payments over time.
A hire purchase contract will usually involve a deposit on the asset or assets, after which your payments on the asset will be determined, depending on the amount of time you would like the hire purchase contract to cover. The duration of the contract can vary to suit your budget and your business needs. The interest rates charged as part of the hire purchase terms can be either fixed or variable.
Sometimes a final ‘balloon’ payment can be incorporated into the repayment plan allowing for lower monthly payments with the benefit of ownership at the end of the agreement.
VAT is usually paid at the start of the agreement – VAT registered companies can claim this back straight away.
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