There is a general lack of understanding as to what exactly business contract hire is, on this page we’ll try to break down exactly what it means, and how it can be used to benefit your business..
You simply hire a vehicle from the finance company, for an agreed period at a contracted monthly rate.
With Contract Hire, the finance company retains the ownership of the vehicle throughout the contract and at the end of the contract hire period, the vehicle is returned to us. Business Contract Hire is the perfect option if a company wishes to reduce the financial risk and admin hassle of running their own fleet. The finance company take care of everything for you, including, buying, servicing and the disposal of the vehicles at the end of the contract hire period.
- Business Contract Hire Fixed monthly payments improve cash flow and ease budgeting burdens.
- With contract hire, all of the financial risks are met by the vehicle leasing company, leaving you secure in the knowledge that you need only make a fixed payment each month.
- Vehicles that are leased under business contract hire, are owned by the finance company, and do not appear on your Balance Sheet as a capital asset. This improves your company’s borrowing ratio.
- Administration of the fleet is kept to a minimum, under contract hire, as the finance company are responsible for sourcing, buying, servicing and disposing of the contracted vehicles.