Rates from as low as 8.9%
Business Hire Purchase allows companies to spread the cost of a new or used vehicle through fixed monthly payments, with ownership transferring to the business once the agreement has been completed. It can suit sole traders, limited companies and established businesses that want to keep their vehicles long term without paying the full purchase price upfront.
Streamline Car Finance is an FCA-authorised credit broker with access to a panel of lenders offering different business car finance options. We can compare available agreements based on your vehicle, deposit, preferred term and business circumstances.
Get a free, no-obligation quote by completing the form below or calling 0161 968 3449.
Hire Purchase divides the cost of a vehicle between an initial deposit and a series of agreed monthly instalments. The finance provider remains the legal owner throughout the term, while your business is responsible for insuring, maintaining and using the vehicle in accordance with the agreement.
Most agreements begin with a deposit calculated as a percentage of the vehicle’s value. The amount required will vary according to the lender, the chosen vehicle and the financial position of the business.
A larger deposit reduces the amount financed and can lower the monthly repayments. Low-deposit and no-deposit agreements may also be available for certain vehicles, subject to status and lender approval.
The remaining balance is repaid through monthly instalments over an agreed period, commonly between two and five years. Longer terms can reduce the monthly commitment, although they may increase the total amount of interest paid.
When the agreement uses a fixed interest rate, the repayments remain consistent throughout the term. This gives the business a predictable vehicle cost that can be incorporated into its financial planning.
Once every instalment and the option-to-purchase fee have been paid, legal ownership transfers to the business. This fee is agreed at the outset and is often relatively small.
The vehicle can then be retained, sold or traded in without mileage limits or vehicle return conditions applying under the completed finance agreement.
Business Hire Purchase provides a direct route to vehicle ownership without requiring the full purchase price to be paid upfront. It can be particularly valuable when the vehicle will remain part of the company’s operations for several years.
Potential benefits include:
This arrangement can be an appropriate form of company car finance for businesses that place value on long-term ownership. Once the agreement ends, the vehicle can remain in service without further monthly finance payments.
The right agreement will be influenced by how long the company expects to keep the vehicle and how it wants to structure its payments.
Hire Purchase spreads most of the vehicle’s cost across the deposit and monthly instalments. The payments can be higher than those under an equivalent PCP agreement, but there is normally no substantial optional final payment. Ownership transfers after the agreement has been completed.
Business PCP usually defers part of the vehicle’s value until the end of the term. This can produce lower monthly repayments, but the business must normally pay the optional final amount if it wants to keep the vehicle.
Hire Purchase may suit companies that:
PCP may be more appropriate for a company that expects to change vehicles regularly or places greater priority on lower monthly repayments.
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Business Hire Purchase can have tax and accounting implications, including how the vehicle and outstanding finance are recorded and whether the business can claim capital allowances.
Capital allowances may be available on qualifying business vehicles. The amount and timing of any relief can depend on the type of vehicle, its CO2 emissions and the circumstances of the purchase. Different rules can apply to cars, vans and other commercial vehicles.
VAT treatment also varies. VAT recovery is generally more restricted for cars where private use is available, while different rules can apply to qualifying commercial vehicles.
Speak to your accountant or tax adviser about the treatment that applies to your business before entering into an agreement.
Businesses can normally ask the lender for an early settlement figure. This will show how much must be paid to complete the agreement and take ownership of the vehicle before the scheduled end date.
Settling early may be useful when a company wants to:
Any fees and interest reductions will be governed by the finance agreement. Requesting a settlement figure does not usually commit the business to making the payment.
Finding the right Business HP agreement involves more than comparing the monthly payment. The deposit, interest rate, term, total amount payable and lender criteria can all affect whether an agreement works for your business.
Streamline Car Finance is an FCA-authorised credit broker and works with a panel of lenders offering different business vehicle finance options. We can help you compare available terms and understand the full cost before you make a decision.
When you speak to us, you can expect:
Whether you are financing one company car or several vehicles, speak to our team about the options available to your business.
Looking for Business Hire Purchase for a company car, commercial vehicle or fleet? Streamline Car Finance can compare available options from our panel of lenders and explain the costs before you proceed.
We will clearly explain the deposit, monthly repayments, agreement length, total amount payable and ownership conditions before you proceed.
Complete the form below to request a free, no-obligation quote. You can also contact us or call 0161 968 3449 to discuss your requirements with an experienced member of our team.
It is a form of vehicle finance that allows a company to spread the cost of a vehicle over an agreed term. The business makes an initial payment followed by fixed monthly instalments. Ownership transfers after all required payments and any option-to-purchase fee have been paid.
Hire Purchase is designed for businesses that want to own the vehicle once the agreement ends. Business PCP may offer lower monthly payments, but a larger optional final payment is normally required if the business wants to keep the vehicle.
No, you can do zero deposit however most agreements require an initial deposit. The amount will vary based on the vehicle, lender, agreement length and financial position of the business. Paying a larger deposit can reduce the amount borrowed and lower the monthly repayments.
New businesses may be able to apply, although lenders will assess affordability, the directors’ credit histories and the financial position of the company. A larger deposit or personal guarantee may sometimes be requested. Streamline Car Finance can approach lenders suited to newer businesses.
You may be able to settle the agreement before the agreed end date. The lender will provide a settlement figure based on the outstanding balance and its terms. Any fees and reductions in future interest will vary, so check the settlement figure before deciding how to proceed.
A VAT-registered business may be able to reclaim VAT on an eligible vehicle. VAT recovery on cars is normally restricted unless the car is used exclusively for business and is unavailable for private use. Different rules can apply to vans and other commercial vehicles, so speak to an accountant about the vehicle and its intended use.
