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What is Business Contract Hire?

By Roger Whittaker
29-04-2020
What is Business Contract Hire?

NEWSBANNER

Business Contract Hire is a credit agreement between a trading business (sole trader, Partnership, LLP, Ltd/UnLtd or PLC) and a finance provider. The finance company owns the vehicle, and the customer pays a set amount per month over an agreed term. Therefore to get the best lease price possible, business customers should take out a contract on cars or vans which either come with very good front end discounts, and/or strong residual values. 

There are many benefits to a business in taking contract hire over cash purchase or vehicle finance, not least the lower and fixed monthly costs. 

What does Business Contract Hire include? 

• Optional full maintenance, to cover; tyres, parts and servicing. 

• Road tax. 

• Contract terms of 12 to 60 months. 

• Tailored payment plans to meet your remit. 

• The option to bolt on fleet management support from Leasepoint. 

• Easy access to any car or van at wholesale discounts. 

The Benefits of Business Contract Hire? 

Customers gain several financial and operational benefits from contract hire: 

• Better Cash Flow – Your business only pays for the depreciation of the vehicle over the length of your lease. The total cost is much lower compared to taking out finance repayments on a car or buying one outright. This frees up cash for your business to focus on core activities. 

• Repayments claimed as a company expense – If the cars or vans you take emit equal to or less than 120g/km of CO2, you can offset 100% of the payments against taxable liability. Even if the CO2 emissions exceed this, you can offset a sliding scale proportion to gain benefit too. 

• VAT reclaim – 50% of your VAT on car contract hire payments, and 100% on van or commercial vehicle leasing can be claimed back and 100% of VAT on maintenance elements can be reclaimed too. 

• Reduced vehicle administration – The leasing company handles the administration of the vehicle throughout your contract which reduces fleet admin burden. 

• Increased return on investment (ROI) – Car Contract hire, and Van Contract Hire, are off balance sheet funding methods, meaning you can deploy your cash where it gets most return. 

How can you obtain the best value when you are next looking to take a car or van?: 

• Visit our website www.leasepoint.co.uk and request a business vehicle leasing quote for your company car or van leasing remit. We can also help with personal contract hire too. As well as car and van contract hire, we can supply excellent car or van finance lease quotations too. 

• Let us know what sort of car or van lease you are looking to take on, we can then promptly supply a company car or van lease quotation for you to review. 

• Annual mileage: When requesting a vehicle leasing quotation let us know of the anticipated annual mileage. 

• Maintenance – You may wish to self maintain, or perhaps you prefer the smooth cash flow of a fully maintained car or van business contract hire. 

• Fleet management. We do not want to simply provide you a business car or van fleet lease deal, we can also help with a range of fleet services to help you run a compliant and safe fleet of company vehicles. 

  

Let us know how we can help you, and allow us the opportunity to quote for your next business vehicle leasing need !.