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| Flexi Buy |
What is FlexiBuy?
FlexiBuy is the unique name given by Barclays in Africa to its Instalment Sale Agreement
How does FlexiBuy work?
The customer repays the capital plus interest charges over the agreed finance term Ownership of the asset automatically passes to the customer upon final payment (Unlike Hire Purchase, there is no option fee to acquire ownership)
FlexiBuy - Instalment Sale Agreement
- Income Tax Treatment
- The Buyer deducts the interest cost as well as any capital allowances (Wear & Tear), as if he owned the asset outright
- VAT Treatment
- The Seller charges the full VAT on the cost price, including interest
- The Buyer is able to claim the full VAT input
- Accounting Treatment
- The asset is recorded as an "on-balance sheet" item
- The outstanding debt is shown as a liability
- The Buyer deducts depreciation and the interest cost
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