Hire Purchase An agreement to buy a vehicle usually by installments for the full amount over the term agreed. Title does not pass until all payments have been made, but tax and accountancy treatment assumes you have title from day one.

Benefits Things you need to know Pure and simple purchase plan for a vehicle. Is shown as a company asset on your balance sheet thereby attracting standard capital allowances and interest is usually offset against Corporation Tax liabilities. No VAT is payable on the repayments. The outstanding debt must also be shown on the balance sheet. All vehicle running costs including the risks are yours. There will be a charge if you return the vehicle early. You may not enjoy manufacturer bonuses.