Business leasing


Why tie up your earnings in a depreciating asset that will only cost you time and money. Instead, why not improve your cash flow and gain some piece of mind by trying vehicle leasing for your business?

At Concept Vehicle Leasing we can provide Contract Hire, Finance Lease and Contract Purchase from a range of lenders. Not sure what any of these are, no problem, give us a call on 0800 043 2050 and well explain it all in black, white or orange for you.


Easy straight forward vehicle leasing

Business Contract Hire is the most common form of Business Lease. You commit to leasing a new car or van for a fixed amount of time, making monthly rental payments as you go. At the end of the agreement you simply return the vehicle to the leasing company and take advantage of a new lease deal. Contract Hire is effectively a long term rental and you will not own the contract car or van.

The rentals are calculated based on what the vehicle leasing company buys the vehicle for at the start of your contract, and what they expect it will be worth when you return it at the end, this is known as the residual value. The difference between the original purchase price and the residual value is the vehicles depreciation.


Business contract hire benefits

  • No Depreciation - No risk on the vehicles future value
  • Easy Disposal - Simply return the vehicle in the end
  • Cashflow - Low initial rental and fixed monthly rentals

VAT registered? If so, you can recover 100% VAT on the monthly lease rental when you lease a new van. For contract hire and leasing of cars, there is a 50% restriction if you use the car for personal use - so generally you can recover 50% VAT on a car lease.

Tax Relief - Incorporated businesses can offset 100% of lease rentals against Corporation Tax for cars under 130g/km CO2 and 85% for cars above 131g/km CO2.


Business contract hire limitations

  • No Ownership - The leasing company will retain ownership of the vehicle.
  • Fixed-term Agreement - You are likely to incur costs for early termination of the lease.
  • Fair Wear & Tear - You are likely to be charged if the vehicle suffers damage outside of BVRLA Fair Wear & Tear standards.
  • Benefit in Kind Tax - If your vehicle is for private use through the business, then employees and Directors are liable for Benefit in Kind tax.
  • Mileage - If you exceed your contract mileage you could incur charges. It's is possible to re-schedule mileage part way through the lease.

The heavy use lease

Business Finance Lease is a type of rental agreement, but at the end of the lease deals, you have the option to continue leasing the vehicle, or you can sell it on to a third party. This means that your business is always responsible for disposing of the contract cars or vans and will take the risk on the vehicles' future value. As you are responsible for the future value there are no mileage constraints and you will not incur charges at the end of the lease for damage – although this may affect the re-sale value of the vehicle. This type of agreement usually suits contractors or anyone expecting the vehicle to get a lot of heavy use.

Finance Lease can also include a final residual payment at the end of your contract. This is calculated at the start of your lease to help ease the pressure of monthly rentals.


Business finance lease benefits

Future Value - You can choose to continue leasing or to sell the vehicle at the end.

Cashflow - Low initial rental and fixed monthly rentals.

Unrestricted Mileage - No restrictions on mileage.

VAT registered? If so, you can recover 100% VAT on the monthly lease rental when you lease a new van. For contract hire and leasing of cars, there is a 50% restriction if you use the car for personal use - so generally you can recover 50% VAT on a car lease.

No Damage - Charges No charges from the leasing company for damage.


Business finance lease limitations

Future Resale - Future value of the vehicle could change.

Third Party Resale - The vehicle cannot be sold to your business or a Director of the business at the end of the contract. It must be sold to a Third Party.

Benefit in Kind Tax - If your vehicle is for private use through the business, then employees and Directors are liable for Benefit in Kind tax.


The ownership lease

Business Contract Purchase is where at the end of the contract, you can choose whether to buy the car, or return it to the vehicle leasing company. There is a final balloon payment, which is payable should your business wish to own the car at the end of the contract, this is calculated and set at the beginning of your agreement.

The monthly payments are calculated based on what the leasing company buys the vehicle for at the start of your contract, and what they expect it will be worth at the end, also known as the residual value. This residual value forms the basis of the final balloon payment.

Contract Purchase is only available for contract cars and not an option if you want to lease a commercial vehicle.


Business contract purchase benefits

  • Flexibility - You can choose to return the vehicle or buy it at the end.
  • Cashflow - Low initial rental and fixed payments.
  • VAT Registered? - Payments are based on the total capital cost of the car inc VAT, so VAT is not payable on the monthly payments.
  • Capital Allowances - Recover capital allowances to offset the vehicle cost against taxable profits and reduce overall tax liability.


Business contract purchase limitations

  • VAT Recovery - You cannot claim back VAT.
  • Fixed-term Agreement - You are likely to incur costs for early termination of the lease.
  • Fair Wear & Tear - If you wish to return the vehicle at the end and its suffered damage outside of BVRLA Fair Wear & Tear standards you could be charged.
  • Benefit in Kind - Tax If your vehicle is for private use through the business, then employees and Directors are liable for Benefit in Kind tax.
  • Mileage - If you exceed your contract mileage you could incur charges.

What else do I need to know?

Credit Approval - Your business will need to be approved for credit with one of our lenders before a lease can go ahead. Give us a call on 0800 043 2050 to hear about requirements.

Taking a Lease Car Abroad - You can take a lease car abroad, but you'll need permission from the vehicle leasing company before you go.

Private Number Plates - You can have private plates put on, contact us for help with this.

No Minicabs Sorry - The lenders we work with will not permit cars to be used for minicab services. There are some exceptions for courtesy cars or driving schools.


Give us a call on 0800 043 2050 if you have any about questions about car leasing in London or in the UK, were here to help.