What is Business Contract Hire?
Business Contract Hire allows companies to lease a car, van or truck for a set period of time at a fixed monthly cost. The choice of vehicles to lease and contract terms are flexible, and is very similar to Personal Contract Hire.
VAT registered businesses are able to claim back the VAT on the monthly rental of vehicles.
Benefits of Business Contract Hire
The main benefit of Business Contract Hire is that it enables companies to release cash normally tied up in outright purchase and allows them to opt for a low deposit followed by fixed all-inclusive monthly rental.
Servicing plans, maintenance plans and road tax payments can often be incorporated in the Business Contract Hire agreement so there is a fixed cost of motoring, helping businesses with planning and budgeting.
The amount you will pay overall is the total amount the vehicle depreciates over the term, plus interest and any additional charges.
At the end of the contract, the vehicle is returned with no further obligation to either party, subject to terms and conditions.
For a quotation, help, or advice contact your local dealership and ask to speak to one of our Business Managers.
Is Business Contract Hire the right finance option for me?
Business Contract Hire is suitable for businesses who would like the use of a vehicle for a set period of time but do not want to own the vehicle at the end of the agreement.
FAQ
Business Contract Hire guarantees that vehicles will be off the company balance sheet.
The finance provider owns the vehicle and therefore you are not entitled to sell the vehicle and should maintain the condition of the vehicle to a suitable standard to avoid additional charges when returning it at the end of the hire agreement.
In the event that you exceed the mileage limit, you'll be required to pay a pence per mile charge to the finance provider when they return the vehicle. The pence per mile will be specified at the start of the agreement.
Customers can terminate the hire agreement early but early termination charges are often applied and can be high. The charges will be set out in the hire agreement.
- Company details (including name, address, company reg. number and annual turnover)
- Director details (including name, date of birth and marital status)
- Business bank details (including bank name, account number and sort code)
- Three months' recent bank statements (if the business has been trading for less than two years or for high value vehicles)
- VAT returns or utility bills (if the business has been trading for less than two years)
- Company accounts (if the business has been trading for less than two years)
- Copy of Director's driving licence or company accountant's details (for high value vehicles)
