Finance Lease

WHAT IS FINANCE LEASE?

Finance Lease is a type of finance agreement available for businesses. This is when you lease the vehicle for an agreed primary period of time by making fixed monthly rentals with or without a final balloon. You are eligible for a secondary period of lease when all the rentals pertaining to the primary period have been paid. The secondary period of lease attracts a nominal annual rental, sometimes referred to as a peppercorn rental. 

Why choose Finance Lease? 

  Risk or reward on disposal

  VAT recoverable on rentals and hire allowance eligibility

  Option to use the vehicle after the primary period


What is finance lease for business

ADDITIONAL INFORMATION

  • The vehicle eventually has to be sold to a non-related third party and there is no option for you to own the vehicle
  • Finance Lease also qualifies for hire allowances that can be offset against taxable profits
  • There are no mileage restrictions/penalties, however excess mileage will affect a vehicle’s value at the end of the contract. 

Please seek independent tax advice to find out which finance product is right for your business.