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Business Finance Lease

An alternative business vehicle finance option to contract hire, finance lease offers a little more flexibility. You lease the vehicle from the finance company but the vehicle is your company asset. A finance lease is available to partnerships, sole traders and VAT registered businesses. Many businesses prefer the finance lease option since they can benefit from deferred payments that enable lower monthly fees, with a balloon payment at the end of the contract.

What are the benefits of a finance lease for your company car fleet?

  • Low initial outlay and monthly lease payment.
  • A variety of payment options.
  • Claim up to 50% of the VAT paid on your finance lease, and hire rental tax allowances can be applied for.
  • Your finance lease vehicle is an asset that can be included on your balance sheet.
  • At the end of the term the vehicle is sold to a third party (by the finance company), any proceeds above the pre-determined balloon payment will then be refunded to you as the hirer.
  • There are two types of finance lease – balloon lease, and full payout lease – both of which can result in either a peppercorn rental once the original finance lease has been completed, or the sale of the vehicle to a third party.

Finance Lease - Be Aware of

Ownership of the vehicle is with the finance company throughout the entire finance lease term. They will be responsible for administration of the vehicle so expect to pay various administration and documentation fees.

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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