FAQ: Who is eligible for a Commercial Hire Purchase, and who do they suit?
Who is eligible for a Commercial Hire Purchase, and who do they suit?
Businesses - including companies, sole traders and partnerships - and individuals are eligible for a Commercial Hire Purchase, providing the vehicle is predominantly used for business (income producing) purposes.
Generally, a Commercial Hire Purchase suits business customers who are registered for GST on an accruals accounting basis, as they can then claim the GST in the purchase price of the car as an Input Tax Credit on their next BAS. Commercial Hire Purchase can also suit individuals with a high proportion of business use on their vehicle.
Another consideration is whether the customer prefers to lease the vehicle rather than own it, in which case a Car Lease (Finance Lease) may be more appropriate.
Please note that this information is of a general nature only. You should consult an accountant to obtain information specific to your situation.
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