Hire purchase and leasing
In this lesson, you'll learn how hire purchase and leasing arrangements affect your capital allowances claims for tax purposes.
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In this lesson
- 0:00 Hire purchase and capital allowances
- 0:34 How hire purchase payments split interest and capital
- 1:04 Capital allowances on hire purchase agreements
- 1:30 VAT treatment in hire purchase arrangements
- 2:07 Leasing assets and tax deductibility
- 2:33 VAT and high emission lease cars
- 3:56 Enhanced capital allowances disposal rules
About this lesson
You'll discover why hire purchase is treated as an outright purchase for capital allowances (despite not owning the asset until final payment), how to strip out interest to find the capital element eligible for relief, and why leased assets receive no capital allowances at all. You'll also master the VAT treatment for both arrangements and the specific restrictions that apply to high-emission lease cars, ensuring you handle these common financing methods correctly in your Taxation paper.
Duration: 4m
Transcript
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