You can now tag bills as hire purchases

We’re pleased to announce that you and your clients can now record the fact that a bill will be paid using a hire purchase agreement. This update can save valuable time when recording the purchase of certain capital assets on hire purchase agreements where you might previously have needed to use journal entries and/or dummy bank accounts.

Once you or your clients have indicated that a bill will be paid using a hire purchase agreement, the balance will automatically be posted to the hire purchase liability category in FreeAgent.

If you or your clients need to record additional costs for the asset purchase, such as interest, you can add multiple line items to the bill.

As the asset is paid off each month, you or your clients can explain each instalment as a ‘Bill Payment’, splitting the bank transactions between the bill payment and interest if necessary.

You can find out more about how to record an asset bought on hire purchase when using accruals basis accounting or cash basis accounting in our Knowledge Base.