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Business Contract Hire

If you do not want to own your vehicles outright, Contract Hire enables you to ‘hire’ your vehicle over a specified period of time – one, two, three, four or five years. You pay a deposit – usually the equivalent of three or six monthly rentals – and then your monthly rental is calculated over your preferred period of time.

By far the most popular way for a business to finance their fleet of company cars - over half those registering new business vehicles choose to fund with a business contract hire arrangement. This is due in part to the lower fixed monthly payments that can be arranged. It’s an ideal choice if you don’t wish to own your vehicle; like to change your vehicle frequently; benefit from a low initial expense, and require your business capital for other company investments.

The Benefits of Contract Hire for your business fleet vehicles includes:

  • Expect to pay a deposit of between 1-3 monthly payments upfront, far less than other forms of vehicle finance.
  • The fixed monthly fee is calculated on the vehicle type, price, mileage and residual value (that’s the estimated value of the vehicle at the end of the contract). The higher the value, the lower the monthly payments!
  • Contracts generally run between 12 and 48 months - offering this flexibility affords you the luxury of changing your vehicle for a new, or higher specification model more frequently.
  • Build a servicing, repairs and/or regular maintenance package into your contract.
  • Enjoy a tax break as business contract hire allows you to offset the rental fees against taxable profits.
  • The vehicle does not appear on company balance sheet, which may assist with your company’s account gearing/image etc.
  • Available on new and used vehicles

Business Contract Hire – Be Mindful of

Calculate estimated mileage carefully otherwise you could find yourself paying a higher monthly fee than necessary, or by under-estimating you’ll incur additional fees for extra mileage!

Also, there is no buy-out at the end of the contract.

To further discuss this finance option, please call the franchise branch you require and ask to speak to Sales or, for business fleets, please call us on 01233 220277.

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