Hire purchase with Huxley Corporate Finance allows your business to spread the cost of an expensive asset over an agreed contractual period.
Hire or lease purchase is the most common way for UK businesses to finance their asset purchases. Hire purchase (HP) is a ‘hire contract’ that gives you the option to purchase a vehicle or equipment at the end of a hire period.
Huxley Corporate Finance has a close relationship with our large portfolio of funders, this enables us to secure tailored finance packages to suit our client’s requirements.
Simply put, hire purchase will enable you to acquire cars, commercial vehicles, equipment, plant and machinery.
“Hire/lease purchase is used when a business has to purchase a sizeable asset they do not wish to acquire out of their day-to-day cash flow. HP allows them to spread the cost of the purchase price over its useful working life. It is a painless process.”
Richard Huxley Director
Hire purchase is a straightforward funding option and perfect for businesses in need of purchasing sizeable assets they don’t wish to acquire out of their day-to-day cash flow. HP spreads the cost of the purchase price over its working life. Here’s just a few reasons for using hire purchase:
Hire purchase (HP) allows you to purchase essential operating assets and spread the cost of purchase over the useful life of the asset.
Hire purchase is simply a ‘hire contract’ that offers you an option to purchase the vehicle or equipment at the end of the hire period, typically by payment of an “option to purchase fee”. There are many reasons for using hire purchase when you need to finance your asset purchases:
Hire purchase terms typically range from 12 to 60 months, depending on the asset and lender. Some high-value or long-life assets may qualify for longer terms. We’ll help you choose a repayment period that matches the asset’s usage and your business’s financial strategy.
Yes, most hire purchase agreements allow for early settlement. You’ll usually need to pay the outstanding balance, including any interest due to that point and a potential early settlement fee. We can request a figure from the lender and help you evaluate whether it’s financially beneficial to repay early.
Under a hire purchase agreement, the asset typically appears on your balance sheet as if owned, with depreciation applied over time. The outstanding finance appears as a liability. This accounting treatment reflects both the use and long-term ownership intent of the asset.
In most cases, VAT is due upfront on the asset cost — but it’s usually reclaimable if your business is VAT-registered. You may also be able to claim capital allowances and offset the interest portion of repayments as a business expense. Tax treatment can vary depending on your specific circumstances, so we’ll work with your accountant to ensure everything is structured correctly.