BUSINESS LEASE PURCHASE

Business Lease Purchase gives you all you need to lease the vehicle for a fixed monthly payment. Come the end of your term you also have the added option to own the vehicle outright. Your vehicle purchase should be a rewarding investment and many Business Lease Purchase customers make a final payment (which is usually equal to the residual value of the vehicle at the end of the term) to continue to use a van that they are familiar with.
With contract period lengths of between 24 and 60 months, Business Lease Purchase products also benefit customers wishing to put down an ultra-low deposit. Deposits are usually equivalent to around 3 monthly repayments.

The benefits

The main benefit of opting for Business Lease Purchase is unlocking the opportunity to own the vehicle at the end of the agreement. Owning your own commercial vehicle is extremely advantageous. Once your final payment has been made in full and ownership acquired, your vehicle becomes a valuable asset that can be managed how you see fit directly through your business.
In addition to this, the flexible contract term makes securing the affordable finance you have been searching for simple. Your fixed monthly payments can be easily and predictively managed across contract terms of up to 60 months. The monthly payments aren’t the only aspect of your agreement that are fixed! As a Business Lease Purchase customer, your interest rate is fixed throughout the length of your term meaning you have a set cost that doesn’t become a burden for your business. Your monthly payments aren’t subject to VAT either, which means further savings can be enjoyed.
Whilst Business Lease Purchase may not be the most VAT efficient option, there are reliefs available. The purchase cost may be tax deductible for instance when claimed as a capital allowance.

Is it right for me?

If you are VAT registered, this particular finance product may not be the most suitable for you. All light commercial vehicles (LCVs) financed by Business Lease Purchase must have the VAT due paid in full upfront, which can mean a large outlay for those using this van finance option.

Your vehicle will also appear on your balance sheet with outstanding payments classed as liabilities. Whatever your intended use for the vehicle at the end of your agreed term, it is important to note that you are liable for the full value and the vehicle cannot be returned. These drawbacks however tend to be outweighed by the prospect of vehicle ownership at the end of the term.

For further information about this van finance product or any other of our flexible finance options, please contact our team direct.

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