This business finance scheme offers the benefits of Hire Purchase but with lower repayments. This will be of particular interest to businesses which are not VAT registered. A major benefit are the lower repayments, achieved by deferring a proportion of the car’s cost until the end of the contract period.

The payments are fixed over a period of usually 24 or 36 months (though this can be varied) to assist easy budgeting. At the end of the period, the car becomes the company’s property after the final ‘balloon’ payment has been made.

An additional benefit is that interest on the monthly payment is allowable against tax and you may be able to claim writing down allowances. For the small business, it is a beneficial way to achieve ownership.