Vehicle leasing offers potential advantages to both buyers and sellers. For the buyer, lease payments will usually be lower than payments on a car loan would be. Any sales tax is due only on each monthly payment, rather than immediately on the entire purchase price as in the case of a loan. Some consumers may prefer leasing as it allows them to simply return a car and select a new model when the lease expires, allowing a consumer to drive a new vehicle every few years without the responsibility of selling the old vehicle, or possible repair costs after expiry of the manufacturer's warranty.
What is Contract Hire?
Contract Hire (CH) or Personal Contract Hire (PCH) is a type of agreement which involves renting a vehicle for an agreed period of time for a fixed monthly cost. The rentals would normally be subject to VAT some of which may be reclaimable for a business user. Contract Hire can also allow for servicing and maintenance costs to be included for the user. You simply "Hire" the vehicle for a specified time and return to the contract hire company at the end of the agreement.
Vehicle condition and excess mileage costs may apply.