Contract hire

Contract Hire is the leasing of a vehicle for a fixed period of time at a fixed monthly rental.

The choices of vehicle and contract terms are flexible to meet your individual needs and requirements.

Contract Hire 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. The low costs attributed to CH is because the financial lender is able to reclaim the VAT on the new car and pass the savings onto the hirer in the form of low monthly rentals

Contract Hire has a market share of 40% and is still rising. The Leasing company calculates a residual value for a vehicle at a set age and mileage contract and charges the user a monthly fee to cover the depreciation over that period plus a funding charge along with add-on services such as maintenance and gap insurance. See details.

At the end of the duration of the contract, the vehicle is sent back to the provider with no further obligation to either party, subject to terms and conditions.

Benefits of Contract Hire

• Low initial outlay
• Flexible rental pattern
• Fixed monthly costs which can include maintenance
• More capital available for your core business
• Off-balance sheet borrowing
• No depreciation risk
• No disposal problems
• VAT on rentals reclaimable if Maintenance included.
• Administration & Management transferred to provider.