|
Outright
Purchase |
Lease
Purchase or Hire Purchase |
Finance
Lease |
Contract
Hire |
Contract
Purchase |
|
Who owns the vehicle? |
The Customer |
The Funding
Company until the final payment is made |
The Funding
Company until the final payment is made |
The Funding
Company |
The Funding
Company until the final payment is made |
|
Who carries the Residual Value risk? |
The Customer |
The Customer |
The Customer |
The Funding
Company |
The Funding
Company |
|
Who carries the ongoing Maintenance risk? |
The Customer |
The Customer |
The Customer |
The Funding
Company assuming a maintenance contract is taken |
The Funding
Company assuming a maintenance contract is taken |
|
Is the vehicle on or off the balance sheet? |
On balance
sheet |
On balance
sheet |
On balance
sheet |
Off the
balance sheet |
On balance
sheet |
|
Typically, how much cash is required up front? |
100%
of vehicle purchase price |
Typically
15% of purchase price |
Typically
15% of purchase price |
Typically
6-7% of the purchase price (i.e. 3 months advance rental) |
Typically
6-7% of the purchase price (i.e. 3 months advance rental) |
|
Who arranges delivery and collection of the vehicle? |
The Customer |
The Customer |
The Customer |
The Funding
Company |
The Funding
Company |
|
Does the customer own the vehicle at the end of the
contact? |
Yes |
Yes |
No |
No |
Yes,
if the final lump sum purchase payment is made |
|
Can the monthly payments be offset in full against tax? |
There
are no monthly payments. Capital Allowances can be offset
against tax but are limited to 25% or the vehicle price
of £3000 per annum whichever is the greater. |
The finance
element can be offset. Capital allowances are available
as per "outright purchase" |
All of
the monthly rentals may be offset against tax. For vehicles
costing over £12,000 a proportion is disallowed. |
All of
the monthly rentals may be offset against tax. For vehicles
costing over £12,000 a proportion is disallowed. In
addition 100% of the maintenance payments may be fully
offset. |
The finance
element is allowable with no rental restriction for
cars over £12,000. Capital Allowances are also available. |
|
Assuming some private use, what % of input VAT can be
reclaimed? |
None |
None |
50% of
the VAT on rental payments. 100% of the VAT on maintenance. |
50% of
the VAT on rental payments. 100% of the VAT on maintenance. |
None |
