[R W C™]

Hi Fellas,
There is a bit more to it, the best person to advise you is your accountant.

With contract hire, the van is a liability - not an asset, so the rentals can be claimed against your taxable profit. After a predtertimined time, the van gets handed back, and you start a new contract (without the option to purchase).  This can be a problem if the van is likely to be abused during your ownership, as it must be above a certain standard to avoid charges.

With purchase, you can claim depreciation, and relief on the interest of any monthly payments, and the van shows as a business asset - and what you do with the van is entirely up to you (run it into the ground if you like!)

Then there's lease purchase with balloon, which gives you quite low monthly payments, but with a hefty payment at the end (which is NOT guaranteed to be met by the value of the van)

So basically, it's not really a one-size fits all solution - and you need to consider your own circumstances before making a decision.

Regards,

Ashley

Good post, at last some good info coming out of the forum 

[clarkson]

  hi
  one other thing contract hire and other hp vehicles with balloons, when you hand them back they expect them to be in very good condition. they need the high residual values to clear the outstanding balance.

  we use contract hire for cars, but if you have staff i wouldnt let them use lease vans. if they dink them or leave the cab in a state you will get hit with heavy charges at the end of lease /hire term.

 this can blow your budgeting figures out completely. for vans i prefer to go to a good quality used car dealer put the vat down as a deposit and do a straight loan for the rest. if your vat registered you can claim the vat straight back.

 then the repayments can be very low, not as low hire or lease granted but only a tad more. then you own it at the end of the loan. if your doing 8000 a year you could buy something with 30000 on the clock and in three years its yours with only 54000  so a few more good years for free. yes you will have maintenance but that will be less than starting another lease!

cheers

 john