Lease Purchase

Lease Purchase is a form of Hire Purchase with the option of having a Final Payment 'Balloon' payment at the end of the agreement to keep the proceeding monthly payments to a minimum. No VAT is payable on the payments and ownership passes to the hirer once the last monthly or Final Payment has been made. As there are no mileage penalties and therefore no mileage limits with this scheme the Final Payment is not a 'guaranteed value' and should be calculated with a sufficient safety margin to maximise the chances of equity at disposal.

Suits

• Non Vat registered companies
• Vehicles with a Capital Cost in excess of approx. £25-£30,000
• Companies may wish to retain the vehicle at the end of the term
• Those who prefer to claim Capital Allowances
• Businesses with a small number of vehicles

Benefits

• Ultimately own and have complete control of the asset
• Straight forward repayment facility
• Interest element on payments is 100% tax deductable
• The asset appears on the balance sheet