CONTRACT HIRE

Contract Hire is a great option for companies who emphasise cost control. One regular and VAT- efficient payment will cover most motoring costs and risks, including the Road Fund Licence, depreciation and the eventual disposal of the vehicle. Many clients also choose to include a maintenance package that’s designed to suit them. The only other costs remaining with the customer are fully comprehensive insurance & fuel.

Contract Hire means that clients:

• Gain an additional credit line.
• Can reclaim the VAT on 50% of their payments and on 100% of their maintenance package costs.
• Run vehicles that are not recorded in the Balance Sheet but on the Notes to the Audited Accounts.
• Can claim Hire Rental Tax Allowances.

In Summary Contract Hire offers:

• Fixed cost, inflation free motoring.
• No Residual value risk.
• Low initial outlay.
• Cash Flow benefits for business users.
• Ability to renew cars for minimal outlay.
• Allows cars to be kept up to date and vehicle fleet fresh.

FINANCE LEASE

Finance Leasing is a fixed-term funding option for companies who want to administer their own vehicles and who want to show these as an asset on their balance sheet. Companies choose from 2 options:

• To pay for the entire cost of the vehicle and the interest over the agreed lease period or
• To make lower monthly payments by electing to make a deferred – or “Balloon” Payment at the end of the agreement.

Whichever is chosen, clients never take ownership of a Finance Leased vehicle. It must be sold to a third party and a portion of the sale’s proceeds, together with any “Balloon Payment” must be paid to the finance company.

Under the terms of a Finance Lease, companies will:

• Gain a further credit line.
• Combine a low initial outlay with low monthly costs.
• Reclaim 50% of the VAT on their repayments and claim hire rental tax allowances.
• Show another asset on their balance sheet.
• Have equity in the sale proceeds of the vehicles.