Lease |
Hire Purchase |
| Lessor claims depreciation | Buyer claims depreciation |
| On completion of contract residual (salvage) value goes to Lessor | On completion of contract residual (salvage) value goes to Buyer |
| In absence of specific agreement otherwise, asset is to be returned to the lessor after the lease period. | Asset is conclusively purchased by the buyer at the end of the agreement period. |
| Lease payment is fully deductible for tax. | Only interest portion of EMI/ Hire value is tax deductible. |
Difference between Lease and Hire Purchase
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