Does car contract hire and leasing make sense for contractors?
The UK has long been different in some respects. Take property, for example. While swathes of continental Europeans and indeed Americans have for decades happily rented their properties, our homes very much remain our castles. It’s a similar story when it comes to cars, with over a quarter of motorists in the States leasing their vehicles.
“The UK is now fast cottoning on to why car leasing is often the financially savvy option, though”, comments Lee Wolstenholme, Director of Manchester-based Vehicle Consulting, a broker with over 12 years’ experience. “Cars depreciate the minute they are driven off forecourts, so taking out a traditional loan to buy a new vehicle typically leaves motorists with a car or van that has lost value considerably after a few years. Leasing, on the other hand, means you can simply hand the keys back at the end of the contract and the vehicle’s value isn’t yours to worry about”, Lee goes on to explain.
Hard-working contractors often understandably relish the idea of having a prestige business car or the latest commercial vehicle at their disposal. Paid for using a 5% loan over 3 years, a £35,000 Audi saloon would attract monthly loan repayments in the region of £1,050, with a total amount repayable of around £37,765. Shrewdly taking the contract hire route would make such a vehicle much more attainable, with an initial payment of around £2,000+VAT followed by 36 monthly payments of circa £350+VAT – with no depreciation to fret over.
Driving a brand new car covered by the manufacturer’s warranty and with road tax included gives contractors peace of mind, allowing them to focus on their roles. Maintenance packages are even available, covering the cost of tyres, servicing and any unexpected repairs.
Although it’s clear to see that car leasing often proves financially beneficial and certainly beats public transport or regularly hiring an ad hoc car for a couple of days each time, contractors do need to take into consideration various factors such as VAT, P11D, BIK and CO2 emissions. Vehicle Consulting’s experienced consultants would be delighted to guide Umbrella contractors through these areas. Their knowledgeable service spans everything from initial face-to-face meetings if desired, through to vehicle delivery and ongoing support.
Contact the friendly, knowledgeable team at Vehicle Consulting today for car leasing advice on 0161 431 0011 or email firstname.lastname@example.org (don’t forget to quote ‘Umbrella’ to get the best deals!)