Business Car Leasing & Contract Hire
As with all companies, it is vitally important for a business to be cost effective in everything it does; therefore, business car leasing and contract hire can be a very important element to ensuring such a venture. Acquiring a fleet of vehicles is rarely the easiest of tasks, but with Stoneacre Leasing, we do everything within our power to make this process as stress-free as possible.
While business car leasing and contract hire will not be ideal for all companies, it is generally thought of as the best method of attaining cars for business use, with over half of all new company cars registered being funded this way. The low monthly payments of contract hire and leasing methods are usually what attracts businesses to go down this route, among other factors.
Such contracts work on an initial payment and subsequent monthly payment structure; for example, a deal with a profile of 6 + 35 with monthly payments of £150 would see an initial payment of £900 (6 x £150) and then 35 payments of £150. However, at Stoneacre Leasing, we can help you structure a business contract hire deal that works best for you, with packages that can stretch from 12 months to three-year periods.
The same applies to your mileage, whether you need a deal that allows you 10,000 or 12,000 a year, with an excess mileage charge for those who go over their allotted contracted amount. It is also important to keep in mind that business contract hire and leasing is subject to VAT of which 50 per cent can be reclaimed (usually referred to as blocked VAT).
At the end of the agreement, the car is handed back, with any outstanding charges such as excess mileage or damage to the car to be settled at this time. Following the contract end, you can decide to start up another with a brand new car or walk away completely - it’s up to you.
Advantages to business car leasing
- Low initial payment means you don’t have to fork out huge amounts at the start of the contract.
- Fixed monthly costs allow you to easily plan for the future and schedule your finances, while the payments themselves tend to be cheaper than other deals.
- Business contract hire deals avoid your company tying up capital in cars that are depreciating, allowing you to invest in other areas of the business. Meanwhile, with vehicles leases not having to be shown on balance sheets, your company’s liquidity ratio will improve, as will the return on assets.
- Changing economic climates will not affect the business as much with contract hire and leasing, with added flexibility available to respond to any sudden market changes.
- As some or all of the rental charge able to be offset against taxable profits, business contract hire and leasing offers substantial tax benefits.
- Maintenance packages can be available, including servicing.
Business contract hire - what to keep in mind
- Make sure to fully consider the mileage you require, firstly because of the charges if you go over your allotted amount and secondly because high mileage means higher monthly payments and vice-versa.
- You will never actually own the car.
- While usual wear and tear is accepted, any substantial damage will have to be rectified by yourself in terms of billing.
View Our Offers Get a Quick Quote