What is a commercial hire purchase?
A Commercial Hire Purchase is a commercial finance product that allows businesses to obtain the equipment they need to run their operations (usually a vehicle). A financier will agree to purchase the equipment required and will then hire it out to your business for a fixed monthly repayment over a set period of time. A Commercial Hire Purchase may also be known as a Corporate Hire Purchase, Hire Purchase or Offer To Hire.
How does a commercial
Hire Purchase work?
Hire purchase agreements are a purchase by installment facility providing your business with the ability to use the equipment during the term of the agreement. Your business will only gain legal title to the equipment after its total price (minus any residual value) and the interest charges have been paid in full. For tax purposes, your business will be regarded as the owner of the equipment from the date of commencement. As long as the equipment is used to generate income for the business, the depreciation and interest charges that relate to the hire purchase may be tax deductible.
Benefits of Commercial
- Flexible contract terms ranging from 12 to 60 months.
- Residual value can be applied to the contract enabling the monthly repayments to be tailored to your business’s budget.
- Fixed Interest rates and monthly repayments can be set up to suit your business’s needs.
- If your business is registered for GST, you may be able to claim the GST included in the equipment purchase price as an input tax credit on your business’s next Business Activity Statement (BAS).
Office: Ground Floor, 7/142 James Ruse Drive, Parramatta NSW 2150
PO BOX 123 Oatlands NSW 2117
Connective Credit Services Pty Ltd Australian Credit License: 389328.
Lendfin Pty Ltd Credit Representative Number: 416565. Jalil Wakim Credit Representative Number: 416341