Lease / Hire Purchase

Often referred to as Lease Purchase or Hire Purchase. This is the standard and very common method of acquiring goods with full title passing to you at the end of the agreement. Straightforward, simple and the asset appears in your balance sheet.

Any VAT is payable up front on the purchase price of the goods. With this arrangement, you claim the writing down allowances and the asset is shown on your balance sheet. The interest element of each payment can be offset against taxable income. Depreciation on the asset is entered into your account and is an overhead of your business.