Distinguish between the following: 'Leasing' and 'hire-purchase'.

Leasing Hire-purchase 1. A lease represents a contractual arrangement whereby the lessor grants the lessee the right to use an asset in return for periodic lease rental payments. 1. Hire Purchase is a loan or contract that involves an initial deposit, linked to a specific purchase, which is a way of obtaining the use of an asset before payment is completed. 2. The lessee cannot claim depreciation as he is not an owner. 2. The hirer is entitled to claim depreciation as an owner. 3. The entire lease rental is a tax deductible expense for the lessee. 3. Only the interest component of the instalment is tax deductible for the hirer. 4. The lessee does not enjoy the salvage value of the asset. 4. The hirer being the owner enjoys the salvage value of the asset.