Daljeet Singh
9 months ago on Google
I have wonderful experience with them they are professional,quick and accurate in terms of loan requirements
Finance lease and hire purchase, RyRo Asset Finance
Finance Lease and Commercial Hire Purchase in Sydney
Use the vehicle or equipment your business needs now and pay for it over time. Rohan Joshi at RyRo Asset Finance compares lease and hire purchase lenders and explains the residual, GST and end of term before you sign.
- Cars, utes, trucks, machinery and equipment
- Finance lease, hire purchase and chattel mortgage priced side by side
- Residual and end of term options explained
- 5.0 from 13 Google reviews for RyRo Asset Finance
- Authorised Credit Rep 565295
RyRo Asset Finance Pty. Ltd., (ABN 69 682 063 896) an Authorised Credit Representative (ACR #565295) of Fintelligence Pty Ltd (ABN 80 625 017 174), Australian Credit Licence # 511803.
Updated November 2026
Finance lease explained
What is a finance lease?
A finance lease lets your business use a vehicle or piece of equipment while the lender owns it. The lender buys the asset you choose and leases it to you for a fixed term, with fixed monthly payments. A residual value is set at the start, and at the end you decide whether to pay it and keep the asset.
Commercial hire purchase is its close cousin: the lender also buys the asset, but it becomes yours once the last payment is made. Both sit alongside the chattel mortgage, where your business owns the asset from day one. Rohan arranges all three as part of our asset finance service, from the RyRo office in Norwest.
Quick answer
Finance lease or hire purchase: what is the difference?
Ownership. With hire purchase the asset becomes yours on the final payment. With a finance lease the lender owns it for the whole term, and you choose at the end whether to pay the residual and keep it.
Step by step
How a finance lease works
You pick the asset and the supplier. The lender pays for it and leases it to your business. Here is what happens from quote to the end of the term.
Step 1
Choose the asset
A vehicle, machine or equipment from a dealer or supplier. Send Rohan the quote or invoice.
Step 2
Rohan compares lenders
He matches the asset and your business to lenders whose policy fits, and sets the term and residual with you.
Step 3
The lender buys and leases it
The lender pays the supplier. You use the asset and make fixed monthly payments, with GST in each one.
Step 4
End of term
Pay the residual and keep the asset, refinance the residual, or sell or trade the asset to clear it.
Get a lease quote
Free, no obligation.
RyRo Asset Finance Pty. Ltd., (ABN 69 682 063 896) an Authorised Credit Representative (ACR #565295) of Fintelligence Pty Ltd (ABN 80 625 017 174), Australian Credit Licence # 511803.
Rohan · 0:25
Own it at the end
What is commercial hire purchase?
Commercial hire purchase is a hire purchase agreement for business use. The lender buys the asset and hires it to your business, you pay it off in instalments, and ownership passes to you with the final payment.
The lender owns it first
The lender holds title while you pay. You use, insure and maintain the asset.
Instalments, optional balloon
Regular payments, with a balloon at the end on many agreements to lower them.
Yours on the last payment
Once the final instalment or balloon is paid, ownership passes to your business.
Treated as a purchase for tax
The ATO treats hire purchase as a sale financed by a loan. Your accountant confirms the detail.
Get a hire purchase quote
Rohan prices hire purchase and lease on the same asset.
- 5.0 from 13 Google reviews for RyRo Asset Finance
- Authorised Credit Rep 565295
RyRo Asset Finance Pty. Ltd., (ABN 69 682 063 896) an Authorised Credit Representative (ACR #565295) of Fintelligence Pty Ltd (ABN 80 625 017 174), Australian Credit Licence # 511803.
Looking for the machine itself? See machinery finance or truck finance.
Compare the options
Finance lease vs hire purchase vs chattel mortgage vs operating lease
The four ways a business commonly pays for an asset over time. The big questions are who owns it during the term, what happens at the end, and how GST is handled.
| Finance lease | Hire purchase | Chattel mortgage | Operating lease | |
|---|---|---|---|---|
| Owner during the term | The lender | The lender | Your business | The lessor |
| At the end | Pay the residual, refinance or sell | Yours after the last payment | Already yours | Hand it back or renew |
| End amount | Residual value | Optional balloon | Optional balloon | None |
| GST | In each payment | Generally up front | Generally up front | In each payment |
| End value risk | Your business | Your business | Your business | Usually the lessor |
General features only. Each lender sets its own terms, and the tax treatment depends on your situation.
Want to own the asset from day one? Read about chattel mortgage finance and our chattel mortgage guide, or test repayments with a balloon in the chattel mortgage calculator.
Which structure suits my business?
Rohan prices the options on your asset.
Rohan · 0:22
Residual value
Residual value on a finance lease, explained
The residual is the amount left owing at the end of a finance lease. It is agreed when you sign, and you do not pay it off during the term. That is why lease payments can be lower than a loan that clears the whole price. On hire purchase and chattel mortgage, the same idea is called a balloon.
- A lower residual means higher payments, but less to find at the end
- A higher residual lowers payments, but leaves more owing at the end
- If the asset sells for less than the residual, your business covers the gap
- Lenders set limits on the residual; for vehicles they follow ATO guidance
What are my options when the residual is due?
Three paths at the endShow less
Pay it and keep the asset. You pay the residual from cash and the asset is transferred to your business.
Refinance the residual. Rohan arranges a new loan for the residual amount, so you keep the asset and spread the cost.
Sell or trade it. The sale or trade-in pays out the residual. If it sells for more, the difference is yours; if less, your business makes up the gap.
General information
GST and tax on a finance lease and hire purchase
The biggest practical difference between a lease and hire purchase is often tax timing. This is how the ATO describes it in general terms. Your accountant applies it to your business.
Finance lease
GST is in each lease payment, and a GST registered business generally claims a credit on each one. Lease payments for business use are commonly claimed as an expense. If you buy the asset at the end, GST in that price may also be creditable.
Commercial hire purchase
The ATO generally lets a GST registered business claim the GST in the purchase price up front. For income tax, hire purchase is treated as a sale with a loan, so the business usually claims depreciation and the interest part.
Get quotes for my accountant
Rohan sends quotes your accountant can compare.
Equipment leasing and hire purchase
Who a finance lease or hire purchase suits
Both are business finance for assets used to earn income. These are the businesses we help most often.
Transport and delivery
Vans, trucks and trailers that earn their keep every day, financed without a large outlay.
Trades and construction
Excavators, forklifts, utes and site gear, where the machine pays for itself on the job.
Businesses that upgrade
Equipment that dates quickly, where a residual lets you trade up at the end of the term.
Owners watching cash flow
Fixed payments you can budget for, with cash kept in the business for wages and stock.
Sole trader buying a work car? See ABN car finance.
Sound familiar?
Finance lease and hire purchase situations we solve
Most business owners come to Rohan with one of these. Here is what usually gets in the way, and what we do about it.
- 5.0 from 13 Google reviews for RyRo Asset Finance
- Authorised Credit Rep 565295
Your accountant mentioned a lease
The challenge: You were told a finance lease might suit your tax position, but nobody explained the residual or the end of term.
How we handle it
Rohan prices a lease, hire purchase and chattel mortgage on the same asset, so your accountant can compare them side by side.
A supplier quote with a big residual
The challenge: The dealer or supplier offered a lease on the spot, and the residual at the end looks larger than you expected.
How we handle it
Bring the quote. We compare it with other lenders and check the residual against what the asset is likely to be worth.
Adding to a fleet
The challenge: You already finance a few vehicles or machines and need one more without stretching the business.
How we handle it
Rohan looks at your existing agreements and finds a lender whose policy fits the next one, before you commit to the purchase.
A lease is about to end
The challenge: The residual is due in a few months and you are not sure whether to pay it, refinance it or trade the asset.
How we handle it
We set out each option in plain English and, if you keep the asset, arrange finance for the residual.
These are common situations, not client stories. Every loan depends on your circumstances and the lender's policy.
RyRo Asset Finance Pty. Ltd., (ABN 69 682 063 896) an Authorised Credit Representative (ACR #565295) of Fintelligence Pty Ltd (ABN 80 625 017 174), Australian Credit Licence # 511803.
Rohan · 0:20
Rohan Joshi
Asset finance broker, RyRo Asset Finance, ACR 565295
Who you will deal with
Rohan compares lease and hire purchase lenders for you
You deal with one person. Rohan reads your details, prices the structures that fit, and explains the residual, the balloon and the end of term before you sign. His clients mention the same things in their Google reviews: clear explanations, quick answers and simple paperwork.
RyRo Asset Finance is a separate company from RyRo Loan Centre, working from the same Norwest office. If you would rather talk it through first, book a free strategy call.
Ask Rohan about a lease
Free, no obligation.
RyRo Asset Finance Pty. Ltd., (ABN 69 682 063 896) an Authorised Credit Representative (ACR #565295) of Fintelligence Pty Ltd (ABN 80 625 017 174), Australian Credit Licence # 511803.
Rohan · 0:25
Google reviews
What business owners say about Rohan
Real Google reviews of RyRo Asset Finance, word for word.
5.0
From 13 Google reviews for RyRo Asset Finance
Rohan · 0:31
Sumit Garg
a year ago on Google
Rohan been nothing short of excellent for us. Being proactive, professional and keeping things very simple and easy to deal with. Gave us an excellent deal and whole process was easy as. Thank you for being so helpful is getting us over the line in getting the new car
krunal shah
11 months ago on Google
Thank you for your support to get my business car loan done in 1 day. Highly recommend
Mark Donovan
a month ago on Google
Rohan provided exceptional service, was communicative and transparent through the entire process. I ended up with a far better deal than I would have got on my own.
David John
8 months ago on Google
We had a great expreience dealing with Rohan for vehicle finance. I would highly recommend him. He was very professional and easy to deal with.
Run the numbers
Calculators and related finance
What is a finance lease?
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A finance lease is a way for a business to use a vehicle or piece of equipment without buying it outright. The lender buys the asset and leases it to your business for a fixed term, usually with fixed monthly payments. A residual value is set at the start. At the end of the term you can pay the residual and keep the asset, refinance the residual, or sell or trade the asset to clear it. During the lease the lender owns the asset, but you look after it, insure it and carry the risk on its end value.
What is commercial hire purchase?
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Commercial hire purchase is a business finance agreement where the lender buys the asset and hires it to your business while you pay it off in instalments. Ownership passes to you when the last payment, including any balloon, is made. For income tax, the ATO treats a hire purchase agreement as a sale financed by a loan, so the business is generally treated as the holder of the asset. It suits a business that wants to end up owning the asset.
What is the difference between a finance lease and hire purchase?
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The main difference is ownership at the end. Under commercial hire purchase, the asset becomes yours once the final payment is made. Under a finance lease, the lender owns the asset for the whole term and you choose what to do with the residual at the end: pay it and keep the asset, refinance it, or sell the asset. GST is also handled differently: with hire purchase the GST credit on the price can generally be claimed up front, while a lease has GST in each payment.
What is the difference between a finance lease and an operating lease?
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With a finance lease you take on most of the risks of owning the asset, including its value at the end, and you can usually end up keeping it by paying the residual. With an operating lease you rent the asset for part of its life, often with servicing included, and hand it back at the end, so the lessor carries the end value. Accounting standards such as AASB 16 also treat leases in particular ways for businesses that report under them, so ask your accountant how a lease will appear in your accounts.
Is a finance lease better than a chattel mortgage?
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Neither is better for everyone. With a chattel mortgage your business owns the asset from day one and the lender takes security over it, which suits a business that wants ownership and can use an up front GST credit. A finance lease keeps the asset in the lender's name and spreads GST across the payments, which some businesses prefer for cash flow or accounting reasons. Rohan can price both for the same asset, and your accountant can confirm which suits your tax position.
What is a residual value on a finance lease?
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The residual value is the amount left owing at the end of a finance lease. It is agreed at the start and lowers your regular payments, because you are not paying off the full price during the term. At the end you pay the residual to keep the asset, refinance it, or sell the asset and use the sale to clear it. If the asset sells for less than the residual, your business makes up the difference. Lenders set limits on the residual, and for vehicles they follow ATO guidance.
Can I claim GST on a finance lease or hire purchase?
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If your business is registered for GST and uses the asset for business, you can generally claim GST credits, but the timing differs. Under hire purchase, the ATO generally lets you claim the GST in the purchase price up front. Under a lease, GST is included in each lease payment and you claim a credit on each one. If you buy the asset at the end of a lease, GST in that price may also be creditable. We recommend consulting your accountant for advice specific to your situation.
Are finance lease payments tax deductible?
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Lease payments on an asset used to earn business income are commonly claimed as a business expense, to the extent the asset is used for business. Hire purchase works differently: the ATO treats it as a purchase with a loan, so the business usually claims depreciation and the interest part of the payments rather than the full payment. Leases of luxury cars and private use both change the picture. We do not give tax advice. We recommend consulting your accountant for advice specific to your situation.
What can I finance with a lease or hire purchase?
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Most income producing business assets, including cars, utes and vans, trucks and trailers, excavators and other machinery, forklifts, medical and dental equipment, IT and office equipment, and plant and tools. Lenders have their own rules on the type, age and condition of the asset and on private sales. Tell Rohan what you want to finance and he will check which lenders accept it before anything is lodged.
Can I get a finance lease with a new ABN?
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Sometimes. Lenders usually prefer a business that has been trading for a while, and many ask for a minimum ABN age. Some will consider a newer business when other parts of the application are strong, such as time in the same industry, a deposit, property ownership or a clean credit file. Each lender sets its own rules, so Rohan checks your ABN age and paperwork against lender policy before you apply.
Talk to Rohan
Ready to lease or hire purchase your next asset?
Tell Rohan about the asset and your business. He will price the structures that fit and explain the residual and end of term.
We generally respond within an hour. Prefer to pick a time? Book your strategy call online or contact us.
Rohan Joshi
Asset finance broker, RyRo Asset Finance
- Rohan reads your details and calls you back
- No obligation to go ahead
- Lease, hire purchase and chattel mortgage compared
Rohan · 0:25
More videos from Rohan
- From 13 Google reviews for RyRo Asset Finance
- 5.0
- Lease, hire purchase or chattel mortgage, priced side by side
- 3 ways
“I had an excellent experience with Rohan for my car loan. He was professional, responsive and extremely helpful throughout the entire process. He explained all the options clearly, found a competitive loan that suited my circumstances and made the paperwork simple and stress-free. I highly recommend RYRO services to anyone looking for a reliable and trustworthy car loan broker.”
RyRo Asset Finance Pty. Ltd., (ABN 69 682 063 896) an Authorised Credit Representative (ACR #565295) of Fintelligence Pty Ltd (ABN 80 625 017 174), Australian Credit Licence # 511803.