Finance lease offers a more flexible alternative to hire purchase with more freedom allowing a business the use of vehicles without the need to pay for the asset upfront.
Cash Flow Benefits of a Finance Lease
Finance Leasing can be one of the most cost effective options, if you need full use of a vehicle for minimum outlay but do not require final ownership. Risk on disposal of the vehicle is with the user or leasee, however with our considerable experience and using recognised trade outlets, we can help you every step of the way.
Tax Implications of a Finance Lease
With a finance lease the rentals can be offset against taxable profits. If you are VAT registered, 100% of the VAT payable on the rentals can be reclaimed for any commercial vehicle or car used exclusively for business purposes. 50% of the VAT can be reclaimed for a car used for both business and private mileage.
Who Owns the Vehicle at the End of a Finance Lease Agreement ?
At the end of the lease the vehicle is sold and the sale proceeds (less a nominal sum) are refunded to you as a rebate of rentals, which attract VAT. Due to its low initial outlay, fixed costs throughout the rental period, excellent tax efficiency and flexibility, Finance Lease is favoured by many business users particularly those running commercial vehicles.