As the most popular method for funding company vehicles, contract hire is an agreement that allows businesses to hire a vehicle for use over a set period of time, to an agreed mileage limit and pay a fixed monthly rental fee.
Contract hire is great for businesses who want a fixed motoring cost. Whether you operate 5 or 500 vehicles, contract hire always gives you a constant budgeting indicator to work your finances around.
As an independent company, we don’t push any manufacturers or models. From company cars to commercial vehicles, we can help you choose the best vehicle for the job.
To offer further flexibility when it comes to budgeting, businesses can choose from two types of contract agreement:
Fully maintained contract hire
By far the most popular option for our customers, our fully maintained offering includes all of the following:
- Routine servicing and repairs
- Any brake, battery or exhaust replacements
- AA breakdown cover, including replacement vehicle cover if required
- MOT and vehicle tax if your vehicle is over 3 years old
Fully-maintained contract hire helps businesses to further manage costs as servicing alone can fluctuate dramatically from month to month. It also helps to remove some of the administrative ‘hassles’ of running a fleet of vehicles. Discover more fleet management support services to help further relieve the pressures of managing your fleet in-house.
Non-maintained contract hire
Some businesses require vehicle funding only. Non-maintained agreements give greater flexibility and lower monthly rentals to those companies who administer all other motor maintenance (such as servicing and repairs) in-house.
Another reason for choosing contract hire is to free up capital within your business. This means valuable cash isn’t tied up in your vehicles and can be put to good use in other areas. The tax benefits of contract hire are also considerable. Did you know 50% of VAT is claimable when a vehicle is used in for both private and business use and the full 100% is claimable for vehicles with business use only?