Contract Hire is the hassle free option when it comes to financing your van. You can enjoy fixed cost motoring, a low deposit and low monthly repayments which makes this the ideal way to finance your new van. What's more, with Contract Hire your road tax is automatically renewed at no extra cost.
You can also remove the van from your balance sheet, avoid the issue of depreciation, avoid slipping into negative equity and, at the end of the term you can hand it back for a brand new one or simply walk away.
Because the rental fee is set in line with the van's depreciation, Contract Hire is often more cost effective than choosing to buy your van outright or on a Hire Purchase agreement.
Contract Hire Key Features:
Cash flow – by opting for Contract Hire, the van won't show on your balance sheet. This way you don't need to worry about cash flow or the problem of depreciation and negative equity.
Fixed monthly rentals – helps to aid budgetary control and cash flow.
Low deposit – normally the equivalent of three monthly rentals. In some cases even a £0 deposit is possible.
Tax advantages – monthly rentals include VAT which, if you're VAT registered, you can reclaim every quarter.
Tax relief – you can offset 100% of the monthly rentals against profits
Mileage restrictions – you choose the mileage that's right for you and your business. If you need to do more than you initially thought then any excess mileage will simply be charged at the end of the term (the pence per excess mileage charge will be clearly indicated in your finance agreement).
Depreciation – the van's depreciation is the risk of your finance provider not you.
Optional maintenance packages – you can choose to pay a little extra per month to cover any costs associated with servicing, roadside recovery, repairs and tyres.
Road Tax included – your tax will automatically be renewed.