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vehicle leasing and contract hire
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| www.thewordis.com |
vehicle leasing and contract hire
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Car leasing and vehicle contract hire - in a nutshell !Focus on vehicle leasing and contract hire |
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If you are older than forty you may remember the 'Running In' sticker - (and the Esso Tiger's tail) now the message on the majority of new cars tells us that it is a Lease Hire, Contract Hire, Personal Lease, Contract Lease or supplied by a Total Fleet Service company. What does it all mean? Logic tells me that it can't be that difficult to grasp because all the new cars seem to be connected with leasing. I know that for many years companies leased their cars, vans and trucks via a finance company and usually your company car was leased because it was cost effective for your employer - although the tax advantages today are not the same. I wondered whether all these phrases like Contract Lease, Contract Hire, Personal Lease, Personal Hire, Lease Hire, Finance Lease, Leaseback, Contract Purchase etc all meant the same thing and simply represented brand names or phrases to confuse car buyers. I want a new car, I want to change it in say three years without losing fortunes but I am shy of high pressure car sales people - so the last thing I want to do is interupt a new car salesman to ask him for an idiots guide to car leasing. The Internet is the lazy way of finding information and prefer Google.co.uk and rather than typing in all the phrases relating to leasing or hiring, I opted for the two most meaningful words ' Lease-Hire ' and Google introduced me to Total Fleet Services in Staffordshire. Incidentally, www.topresources.co.uk also pointed me towards Total Fleet Services. Having looked at their website on www.lease-hire.co.uk , I opted for the old fashioned telephone and had a chat with Kevin Harris who kindly explained the difference between; Contract Lease, Contract Hire, Personal Lease, Personal Hire, Lease Hire, Finance Lease, Leaseback, Contract Purchase etc Contract Hire Contract Hire is a highly cost effective method for company vehicles.
A fixed monthly rental is set over an agreed period. If you have maintenance
built into the deal then your expenses other than the rental is fuel
and insurance. For company fleets this is wotyh looking at because of
recent changes to VAT regulations on company cars. Finance Lease Finance lease is geared towards businesses that are prepared to take on the risk factors of usual maintenance costs and those dreaded disposal values,and are looking for a cost-efficient method of funding acquisition. As with contract hire, finance lease has become a very attractive against other forms of finance following changes to the VAT regulations. Sale and Leaseback Sale and leaseback enables companies currently owning rather than leasing
their vehicles to release the cash value of the fleet. This value can
be fixed to suit profit and loss reporting requirements. Dial purchases
the fleet and leases it back on agreed terms. This provides a business
with an alternative method of obtaining a cash injection when needed.
Assuming you have a car or fleet of cars. A specialist firm such as Total Fleet Services. will purchase the fleet/car and lease it back to you on agreed terms, providing a method of obtaining a cash injection by releasing the ownership, yet keeping the cars. Contract Purchase and Lease Purchase The major difference of Contract Purchase and Lease Purchase compared with conventional contract hire is that the client will be given the option to buy the vehicle at the end of the contract. This means that contract purchase has to be added onto the company's balance sheet. So a company has all the benefits of contract hire, with the added value of real savings on corporation tax and VAT. Note however it is designed for higher value vehicles and is even more relevant if you are unable to claim back your VAT. All of the relevent charges such as finance and maintenance, can be claimed against corporation tax, whatever the capital value of the vehicle.
But what about the private individual ?
I am reliably informed that this latest method of running a newcar gives me quite a few iimportant advantages:Let's say that I have chosen a new car tthat costs £10,000 and I want a short repayment period, say a two-year agreement. Remember though that the new car cost here is an example, it could be £20,00 or £40,000. Initially Total Fleet Services would assess how much my car will be worth at the end of the two year agreement. For the sake of arguement, the value is £4,000 after the two years. This sum is known as the final instalment. We're not going to get complicated here, in fact the sum is quite simple. Just deduct the final instalment (£4,000) from the cost of the new car - resulting in a final figure of £6,000. I intend to keep the car for two years, so my monthly payments, including the interest charges for the total cost of my new car, are calculated on the lower figure of £6,000 instead of the original cost of £10,000. The low monthly payments provide an easy and economical way for me to afford my new car. What about the deposit, I suggest you talk with Total
Fleet Services but you don't have to put down a big deposit - it's
usually the equivalent of three monthly payments. I'm not restricted
to any car franchise or dealer in fact I can have any car or light van
that I like as long as it is within my budget. After two or three years,
I can choose another brand new car, and I will have no trade-in hassles.
Alternatively I can make my final payment and keep the car. So I'm pleased I spoke with Kevin Harris at Total Fleet Services, he has explained in a clear and conscise manner, all my options and without the high pressuure associated with new car sales people. Personal Leasing offers a very flexible, more convenient way to drive a brand new car.
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Contact Information Total Fleet Services Ltd Stafford Road
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News Release By Peter Yexley Telephone 01707 646457
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