Contract Hire Quotes, Vehicle Funding & Car Leasing | CVSL

What is Contract Hire?

Contract Hire is an agreement to lease a vehicle (car or van) for a set time period (and mileage) at a fixed monthly cost. The monthly Contract Hire rental amount is based upon the original cost of the vehicle, the mileage that is to be covered and the Contract Hire rental period (for example 24 months). An allowance for depreciation is also factored in to the final Contract Hire monthly cost. Maintenance packages can often be included within a Contract Hire agreement but these are not obligatory. Such Contract Hire maintenance packages would typically provide cover for all car or van servicing within the period of the Contract Hire agreement. Contract Hire agreements are usually preferred by vat registered companies,sole traders and partnerships.

• No depreciation risks.
• No disposal issues/costs.
• Off balance sheet funding.
• 100% vat recoverable if sole business use applies, 50% vat reclaimable if business/private use applies.
• Road fund licence is included for the term of the contract.
• Option to include maintenance for the contract term.

What are the advantages of Contract Hire?

Contract Hire offers many advantages, especially for vat registered companies who do not wish to show their vehicles as an asset on their balance sheet.
Contract Hire allows the company to reclaim 50% of the vat on cars and 100% of the vat on vans of the Contract Hire monthly payments and 100% of the vat on any maintenance package. There are also certain tax allowances that can be utilised with Contract Hire.
With Contract Hire you no longer have to worry about the residual value of the vehicle as this is all factored into the Contract Hire quote.
There is no large initial capital outlay with Contract Hire because as your payments are evenly spread out over an agreed period (detailed in your Contract Hire quote).
Contract Hire gives you the freedom to change your cars or vans on a regular basis thus allowing you to take advantage of the latest technological developments in fuel efficiency and safety.
Finally, Contract Hire gives you peace of mind with fixed cost motoring.
If you would like a Contract Hire quote, please use our unique free instant quote system above.

Daily Contract Hire

Daily Contract Hire operates in a very similar way to standard Contract Hire but the Contract Hire periods are typically much shorter – in most cases just up to 12 months.
We normally recommend Daily Contract Hire when a company has a fluctuating requirement for vehicles: maybe someone is on a very short term contract for example. Our free instant quote system does not cover Daily Contract Hire options, so for advice and further information please give our Contract Hire team a call.

Finance Lease

Finance Lease is an increasingly popular vehicle financing option. In a Finance Lease arrangement, the monthly rental you pay is calculated by taking into account the actual cost of the vehicle, the period you want the rental to run and the forecasted future value (residual value) of the vehicle based on the annual mileage.
A final payment which is equal to the estimated future value of the vehicle is paid at the end of the contract. At the end of the contract period, the vehicle is sold and 98% of the sale proceeds returned to you.
If you decide to use a Finance Lease arrangement for your vehicle, there are usually two different options open to you:
Firstly, you can opt to spread the pay entire cost (the cost of the vehicle and interest payments) in agreed monthly installments spread over the period of the lease agreement.
Secondly, you can choose to make deferred payments. In this situation you make lower monthly installments but then make one final payment (commonly known as a balloon payment) at the end of the lease.
It’s worth noting that in a Finance Lease arrangement, you actually never become the owner of the vehicle. At the end of the lease agreement, the final balloon payment is made to the finance company and the vehicle is sold on to a third party.
Finance Lease as a vehicle funding option does have a number of benefits. Like Contract Hire, 50% (vans 100%) of the vat payments can be reclaimed and, also like Contract Hire, you can apply for certain tax allowances and the vehicle can be treated as an asset on the balance sheet. Finance Lease also gives you the option of lower monthly payments and a low initial outlay. You may also benefit from an equity resulting from the final sale of the vehicle.

• Sole business use 100% vat-recoverable, 50% vat reclaimable if business/private use applies.
• Flexible - Option to exchange or dispose of the vehicle throughout the contract.
• On balance sheet funding, shows as an asset.
• On disposal equity retained by user.
• Option to include maintenance.

Contract Purchase has the benefit of fixed monthly payments with the option of ownership.

• No depreciation risks.
• No Disposal issues/costs.
• Balance sheet Funding.
• Option to acquire vehicle at a pre-determined purchase price.
• Option to include maintenance.

A fixed rate funding option to acquire ownership on completion of the agreement.

• On balance sheet funding.
• 25% writing down allowance up to a maximum of £3000.00 per annum.
• Ownership.
• Option to upgrade or dispose of the vehicle during the agreement.

The same benefits as Hire Purchase with the additional option to include a balloon payment to reduce monthly payments.

• Reduced payments.
• On balance sheet funding.
• 25% writing down allowance up to a maximum of £3000.00 per annum.
• Ownership.
• Option to dispose or upgrade the vehicle during the agreement.

Purchase the vehicle at an agreed discounted figure.

• Benefit from discounts we obtain on your behalf
• 25% writing down allowance up to a maximum of £3000.00 per annum

Available to employees opting out of a company car scheme, and private individuals.

• An alternative to a company car
• Fixed monthly payment with the option to purchase.
• Option to include maintenance.

Allows companies to release capital invested in vehicles to reinvest in the business, enables the client to fund there current vehicles in a structured fixed cost contract.

• Release capital from a depreciating asset.
• Re-invest the capital into the company.
• Fixed cost contract.