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Contract Hire eliminates risk. It’s the perfect product if you don't want the financial unknowns of running a company car fleet. There's no need to worry over plummeting vehicle values, rising interest rates or escalating service costs. Your rentals are locked for the duration of hire, so your capital outlay is fixed and certain for the entire lifetime of the vehicle. A Contract Hire agreement is effectively long-term hire. Typically, full maintenance is included, but non-maintenance agreements are also available. The beauty of Contract Hire is that services can be added or removed as necessary. You decide how long you want to hire a vehicle and then pay a regular instalment that is fixed for the duration of the hire. At the end, you simply return the vehicle to us.
Sale and Leaseback: the ideal way to release valuable capitalIf you like the sound of Contract Hire, but already own your fleet, Sale and Leaseback is the answer. This fast-track scheme allows you to convert the vehicles you own onto Contract Hire, quickly and easily. Arnold Clark Vehicle Management will buy your vehicles from you, and then lease them back to you. You get to enjoy the many business benefits of Contract Hire. At the same time, this releases the capital tied up in your fleet, providing an immediate cash injection for your business. |
Important tax changes that make Contract Hire even more popular
The 2008 Budget saw a number of significant changes that will affect fleet operators from April 2009. First, the Expensive Car Disallowance that applied to Contract Hire rentals, was abolished in favour of a CO2 based system. Capital allowance rules where also changed. Now a company can only depreciate vehicles at 20% per annum (restricted to 10% where the CO2 emission of the vehicle is over 160g/km). Furthermore, the balancing allowance which used to apply on disposal, has also been abolished. This means that companies may now find themselves claiming allowances many years after a vehicle has been disposed.
All in all, the Budget clearly favours fleets who use Contract Hire, especially for high value, low emission cars.