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Contract Hire Vans - Improve your cash flow
Vans continue to be owned by the funder yet are hired to you for a set period of time and at a fixed monthly rate. This method of van finance can be useful for companies wanting to free up credit lines or improve cash flow by implementing fixed cost fleet operation.
The monthly rental charged for contract hire vans is calculated based upon the cost of the van, the contract period and the anticipated re-sale value.
It is also takes into consideration the predicted mileage, service and maintenance costs, together with any additional services such as relief vehicles.
Under a van contract hire agreement the Funder retains ownership of the van at all times and therefore continues to absorb the subsequent risks such as unforeseen running costs and uncertain re-sale values.
Where contract hire vans have a partial private use then 50% of the VAT on rentals is recoverable, whereas the service and maintenance elements of the rental are fully recoverable.
Contract hire vans are not recorded as assets on the balance sheet, thus improving company gearing ratios.
VAT is built into the monthly payments, but is not reclaimable by private individuals. Maintenance packages are usually available so that you don't get any nasty surprises.
If you need any help give us a call on 01204 537 768 or use our contact form.
Other van finance options available include:
