Hire Purchase

Tax effective hire purchase solutions for sole traders and businesses

Why Hire Purchase?

What is hire purchase?

A hire purchase is a flexible and cash flow neutral finance solution for business looking to eventually own cars, equipment, or long-term assets. Repayments can be tailored to your business cycle. You can reduce repayments using a balloon payment (residual value) payment, due at the end of the loan term. A hire purchase doesn’t require a deposit, and all repayments are on the books as operating expenses. As a business loan, you can also finance maintenance and servicing as part of the hire purchase agreement, with an amount more than 100% of your asset’s value.

Accounting and tax benefits?

With all hire purchases, ownership of the equipment or car rests with the lender until the end of the loan term. This means you are effectively hiring or renting the asset which means repayments are classified as a business operating expense. Your lender may claim GST, depreciation, and interest paid on the loan and pass it on as savings to you. This may suit businesses that require off-balance sheet accounting. Our experienced consultants have access to the best finance products and rates. MortgageBiz will make it simple and easy for you to make an informed decision.

Getting you approved with your Hire Purchase

We are accredited with the most reputable commercial lenders in Australia giving you a fair choice to compare.
Competitive Rates
We connect with over 25 lenders to drive down interest rates and provide more value.
Vehicle Ownership
You own the vehicle once the final payment is made (including any residual balloon amount).
Fully maintained options
Ask about our full-maintained options. this allows you to bundle all car costs into one monthly payment.
Tax effective
Under a Hire Purchase, interest component of repayments and depreciation is tax deductible.
No deposit
No deposit required under a Hire Purchase agreement. 100% finance available for approved applicants.
Online fast approvals

Help from start to finish
Our personal consultant will guide you through the process, answering all your questions along the way.
Why should my business apply for a hire purchase?
Business gains many tax breaks and other incentives. GST paid on the asset as well as interest and depreciation is claimable; either are passed on by the lender or claimed by your business. You are also eligible for the instant tax write-off.
What is a balloon payment?
A balloon payment, or residual value payment, is a part of the loan set aside for payment at the end of the loan term. This has the effect of reducing regular repayments. When the loan term is up, you can pay out the balloon, refinance the balloon, or in some cases, trade in your equipment or car if it meets certain conditions.
What is meant by hire purchases being “cash-flow neutral?"
This means your business will not have to dip into savings or cash reserves to immediately fund the hire purchase. You can borrow 100% of the asset’s value, and even cover expenses such as registration, insurance, training, installation, and maintenance.

Frequently Asked Questions

Can’t find the answer you’re looking for? Reach out to our customer support team.

Need some help?

Our experts will help you search, choose and settle your home loan online. Chat to one of our Home Loan Specialists at a time that suits you.
Call Us  1300 149 149