Hire Purchase

At Platinum Direct Finance we can give you access to the best Hire Purchase financing option in Australia. We can also offer all clients the lowest rates and we guarantee to beat any written quote from a car dealer, bank or finance broker.

What is a Hire Purchase?

A Hire Purchase is a car financing option for a motor vehicle that will be used primarily for business use. It can also be known as a CHP, Commercial hire purchase, corporate hire purchase, asset purchase, offer to hire or term purchase.

How does a Hire Purchase work?

A Hire Purchase agreement is where the finance provider agrees to purchase the car on behalf of the customer and the customer hires the motor vehicle from the finance provider over an agreed period of time for a fixed monthly repayment.

The ownership of the motor vehicle is not transferred to the customer until the final payment/ balloon payment has been made.

Under a Hire Purchase agreement, the customer is the registered owner of the motor vehicle and is responsible for all costs associated with maintaining, running and insurance for the motor vehicle.

Hire Purchase features

• Low establishment fees and monthly fees, no payout penalties
• Commercial hire purchase terms range from 1 to 5 years
• Interest rate is fixed for the term
• Hire Purchase monthly repayments are fixed for the term
• You can claim the interest and depreciation as a tax deduction
• Residuals and Balloons can be structured to reduce your repayments

Hire Purchase taxation implications

A Hire Purchase allows the hirer to claim an input tax credit for the GST component of the purchase price, provided that the customer is registered for GST. Where the customer is using the accrual accounting method, the input tax credit may be claimed on the next Business Activity Statement (BAS). If the cash method of accounting is used, the GST can be claimed as an input tax credit over the term of the contract.

The monthly repayment or balloon amount is not subject to GST.

Where the vehicle is used for business use, the hirer can claim "interest and depreciation". That is interest on the lease payments and depreciation up to the luxury car tax threshold or depreciation limit.

Who does a Hire Purchase suit?

A Hire Purchase suits someone who is going to use a motor vehicle predominately for business use, therefore this car financing product is used by Companies, Trusts, Sole Traders, Partnerships, ABN holders and individuals who receive a car allowance.

Which car financing product is right for you?

Deciding on the right car finance option for your situation can sometimes be confusing. Novated Lease, Chattel Mortgage, Car Lease are just a few of the car financing options. Platinum Direct Finance can assist with your decision making and make the process simple and easy.

Why use Platinum Direct Finance?

The Platinum Direct Finance group of companies will finance over 800 million dollars worth of equipment and car finance this year! Due to this volume and buying power, we can give our clients access to the best finance rates and financing products across Australia.

Need further information?

If you require further Hire Purchase assistance, either complete our friendly enquiry form or call an experienced finance consultant on 1300 554 553 today.

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