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Don’t use a commercial hire purchase agreement (CHP) as a novated lease agreement

Some advisers are suggesting it is advantageous to try to novate a hire purchase agreement for a motor vehicle, to an employer. There is no public tax ruling to cover this arrangement and it would be very difficult to achieve a beneficial result.

If you want to novate an agreement is always safest to base it on a finance lease and not hire purchase, or any other chattel finance instrument.


 

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