How hire purchases work?
A hire purchase agreement is an asset finance product that transfers ownership of the equipment from the lessor to the lessee, once the final payment has been made. Interest and depreciation are tax-deductible and GST can be claimed up-front.
When should you use hire purchase?
A hire purchase product is commonly used when you want to:
- utilise a tax-deductible asset finance product;
- smooth cash flow by agreeing to set payments over a specified period;
- own the asset at the end of the agreement.