what is contract hire & how does it work? 

Contract hire is a non-ownership rental agreement that allows you to use a vehicle for an agreed period of time. 

Contract hire requires an initial advance rental which can be as little as your first monthly rental, followed by a fixed term and mileage with contract options between 24 and 60 months.

At the end of the contract you are able to return the vehicle to the funder, letting them take responsibility for the risk of depreciation and disposal.

There are terms and conditions which could incur additional costs on return, including mileage and vehicle condition.

what are the advantages of contract hire?

• Minimum capital expenditure
• Accurate monthly budgeting
• Improved cash flow
• Fixed interest rates
• Rentals or a proportion of the rentals can be offset against the businesses profits
• No vehicle disposal problems
• Reduced administration
• On-going advice and support
• Road Fund Licence provided (vehicle excise duty paid) for duration of contract
• Optional maintenance package
• Optional breakdown rescue cover
• Optional replacement vehicle cover in event of breakdown
• Some maintenance packages also include tyre replacement

what are the disadvantages of contract hire?

• Fixed term and mileage contract
• Early termination can be expensive
• If you do more miles than agreed you will be charged excess mileage
• You must look after the vehicle and return it in a well maintained condition otherwise you will be charged for any damage over and above that stated in the Fair Wear and Tear Guide where applicable