Finance Lease for the Business User

Finance Lease is a tax efficient way in which to fund vehicles, it has similar VAT and Corporation Tax benefits to Contract Hire, but the responsibility and risk for the resale of the vehicle at the end of the term remains with you.

There are two main types of Finance Lease, one where you pay the entire cost of the vehicle, including interest charges over an agreed period or you can choose a lower monthly repayment with a final balloon payment which is based on the anticipated future value of the vehicle at the end of the lease period.

Monthly payments and interest rates are fixed throughout the agreement, giving you the benefits of fixed monthly costs. The responsibility for resale at the end of the contract is yours and as such any risk or reward associated with the sale remains with you.

Key Benefits of Finance Lease

• Low Initial payments
• Monthly rentals are fixed
• Choice of a balloon payment to reduce monthly rentals
• Rentals can usually be offset against taxable profits
• Option to continue to operate the vehicle at the end of the contract under a "peppercorn arrangement".

Finance Lease for the Private Individual

Personal Finance Leases are a cost effective way for individuals to fund a vehicle, often allowing for a more expensive or higher specified vehicle to be purchased without an increase in monthly repayment over traditional personal finance methods for cheaper vehicles.

The final payments are flexible and can be tailored to your exact requirements at the start of the agreement and because the final payment is not guaranteed there are no excess mileage charges at the end of the agreement should you go over your anticipated contract mileage.

This type of funding method is an ideal way for private individuals to obtain a lower rate finance product that is normally only available to business users, monthly rentals are the same as for business users, but with the VAT simply added on.

Key Benefits of Finance Lease

• Low Initial payments
• Monthly rentals are fixed
• Choice of a balloon payment to reduce monthly rentals
•  No excess mileage charges