What is personal contract hire car finance?
Personal contract hire is a contract to hire a car over a fixed period. It means you will not own the car yourself. The cost of a contract hire is divided into monthly rentals and these are worked out by Perrys. They vary depending on the type of car and the mileage you will be doing each year. You usually have to pay 3 or 6 rentals upfront too.
Contract Hire rentals can include a maintenance package to cover road tax, servicing and in some cases tyres too. Which means you only have to put in fuel and drive it!
Contract Hire is popular for businesses who are VAT registered because they can claim back half the VAT on the hire charges and all the VAT on any maintenance. At the end of the agreement you simply hand back the car. You don’t have a final balloon or large payment and you don’t have to arrange to sell the car. You just hand back the keys and walk away. You can then start another Contract Hire agreement on a brand new car.
Advantages of personal contract hire
No deposit to pay
No large final payment or balloon payment
Hire rentals can include all the maintenance
If you are a business you can claim back a lot of the VAT
You don’t have to arrange the sale of the vehicle at the end of the agreement
Working out which finance option suits you best? Pop into Perrys.