your finance options are explained here...
For business users and private individuals requiring a personal contract, it might help you to think of your funding options falling into two broad categories - 'Usership' and 'Ownership'. Usership provides a cost-effective vehicle funding solution without attracting the long term and eventual risks and responsibilities associated with ownership. Ownership finance provides a route to eventual ownership and to the risks / rewards and responsibilities associated with it. Each funding method has it's own unique characteristics which will make it more or less appropriate in an individual set of circumstances and user requirements. For more information or clarification on any of the following funding methods please contact us on Freephone 08000 288323
Leasing – ‘Usership’
Contract Hire
A popular choice for VAT registered businesses and private individuals requiring minimum outlay and providing optimum user friendliness.
The vehicle is hired for an agreed period of time and a fixed rental is paid based on the anticipated mileage (the higher the mileage, the higher the rental). Contracts can be hire only or include full maintenance to cover routine servicing and tyre replacement etc.
At the end of the contract the vehicle is simply returned to the finance company. Up to 100% of rentals can be offset against taxable profits and, depending on the vehicle type and nature of its use, up to 100% of the VAT on the rentals can be reclaimed.
- 18- 60 month contracts
- Low initial rental (usually equivalent to three monthly rentals)
- Mileage restrictions apply
- Any vehicle - new or used (up to 12 months old)
- Vehicle does not show on Balance Sheet
- Road tax included for full contract
- Fixed costs
Finance Lease
Similar to contract hire and ideal for VAT registered businesses that want to handle the administration of their vehicles.
The lessee will assume responsibility for selling the vehicle at the end of the contract (instead of it being collected by the leasing company) usually to settle a pre-agreed residual payment. The lessee can potentially profit on this sale, if the sale amount exceeds the residual payment. Shown on balance sheet.
VAT on rentals
- 18- 60 month contracts
- Any vehicle - new or used ( up to 12 months old)
- No mileage restrictions (although the lessee will ultimately pay for the full depreciation of the vehicle while in his possession)
- Low initial rental (usually equivalent to three monthly rentals)
Purchase / Option to Purchase – ‘Ownership’
Contract Purchase
Ideal for customers who would like the option to purchase the vehicle without taking all the depreciation risk.
Similar to contract hire, the customer pays a fixed monthly payment for an agreed period of time based on an anticipated mileage. Maintenance can be included as an option. At the end of the contract the customer can pay a predetermined final payment to purchase the vehicle or simply return it to the finance company. Writing down tax allowances apply. Shown on balance sheet.
Low deposit (usually equivalent to three monthly payments)
VAT payable only on any applicable service element of the contract
Mileage restrictions apply
- 18- 60 month contracts
- Any vehicle - new or used (up to 12 months old)
- Road tax and breakdown cover included for full contract
- Fixed costs
- Optional eventual ownership
- No decision on the option to purchase need be taken until the end of the contract
Lease Purchase / Hire Purchase
Used by companies who require definite eventual ownership of the vehicle.
The customer acquires the vehicle when all the payments, including an option to purchase payment, have been made. Part of the capital cost of the vehicle payment may be deferred into a 'balloon' or residual payment at the end of the agreement (Lease Purchase), which equates to the anticipated value of the vehicle at the end of the agreed loan period.
Low deposit (usually equivalent to three monthly payments or 5-10% of the capital cost of the vehicle)
No VAT involved
Writing down tax allowances apply
- 18-60 month contracts
- Any vehicle - new or used (up to 12 months old)
- Eventual ownership
- No mileage restrictions (although the purchaser will ultimately pay for the full depreciation of the vehicle while in his possession)
Personal Contract Plan - PCP
For private individuals who want a hassle-free and cost effective way to finance and maintain a vehicle.
The individual can choose a full maintenance or non-maintenance option. A residual payment is incorporated into the contract and is payable at the end of the primary contract period, should the individual wish to acquire ownership of the vehicle. Alternatively the vehicle can be returned to the finance company at this point.
Low deposit (usually equivalent to three monthly payments)
Mileage restrictions apply
- 18- 60 month contracts
- Any vehicle - new or used (up to 12 months old)
- Optional eventual ownership
- Allows a private individual to benefit from the fleet buying power of the leasing company
- No decision on the option to purchase need be taken until the end of the contract
Allied Vehicle Contracts Supply
Alfa Romeo Aston Martin Audi BMW Cadillac Chevrolet Chrysler Citroen Fiat Ford Honda Hyundai Isuzu Iveco Jaguar Kia Land Rover Lexus Mazda Mercedes Mini Mitsubishi Nissan Peugeot Porsche Renault Saab Seat Subaru Suzuki Toyota Skoda Smart Vauxhall Volkswagen Volvo
