Lease21 Contract Purchase
For any Business with high value or specialist vehicles who want the option to purchase without depreciation risks.
The major difference between Contract Purchase and Contract Hire is that there is an opportunity for the client to purchase the vehicle at the end of the contract period. As an alternative the vehicle, at the end of the contract can be returned to the funder.
If you are restricted in the amount of VAT you are able to reclaim, or if you operate expensive vehicles (probably in excess of £30,000), a taxation advantage may be achieved by retaining ownership of the vehicle.
Contract Purchase offers all the operational and administrative benefits of Contract Hire, together with the tax-efficient benefits of ownership, such as the ability to claim capital allowances.
You enter into a finance agreement for the vehicle for a pre-determined period at a fixed monthly payment.
You have the option to buy the vehicle at the end of the contract by making the final payment which is agreed at the start of the contract. Alternatively the vehicle can be returned at the end of the contract with nothing further to pay.
The fixed monthly payment takes into account the cost of the vehicle, its rate of depreciation, the length of the contract, mileage and any additional services that may be required.