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WWCB2B.COM Finance Lease
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| General |
| A Finance Lease agreement is purely a financial product as it still leaves you with the risk and reward associated with ownership. You are responsible for maintenance, and disposal of the vehicle at the end of the agreement. With changes in VAT legislation in August 1995, it is now possible for the Leasing Company to recover the VAT, on all new and certain used cars,
offering substantial cash flow and interest cost benefits to the hirer. You also benefit from volume related bonuses available via the manufacturers and National Fleet purchasing power. |
| Registration |
| The vehicle is registered in the Leasing Companies name. You can therefore enjoy the benefit of 20,000 unit per year purchasing power even if you only operate one vehicle. |
| Ownership |
| The vehicle remains the property of the Leasing Company throughout the agreement. |
| Insurance |
| You are responsible for Fully Comprehensive Insurance throughout the agreement. |
| Road Fund Licence |
| Road Fund Licence is provided for the first year. Subsequent years are your responsibility and cost. |
| V.A.T. |
| All Finance Lease rentals attract VAT. If you are acquiring a car wholly for use in your business, VAT registered businesses are able to reclaim all the VAT on the rental. If there is any element of private use only 50% of the VAT is recoverable. |
| Balance Sheet |
| Vehicles are shown as an asset of the business with a corresponding liability for future rentals due. |
| Taxation |
| For cars costing under £12,000 and all commercial vehicles, you are able to offset all the rentals paid in any one financial year against tax. For Partnerships and Sole Traders a percentage may be disallowed to cover Private use. For cars costing over £12,000, 50% of the rental attributable to the capital cost in excess of £12,000 is disallowed. |
| Maintenance |
| You are responsible for all maintenance and keeping the vehicle in a roadworthy condition. |
| Early Termination |
| You are able to terminate the agreement at any stage. Although your total liability extends to the total of the outstanding rentals. It is usual however for a rebate to be given. As vehicles do not depreciate evenly, but your repayments are, it is possible that a negative equity situation will arise where minimum initial payments are used, this can be quite
substantial in the early part of the agreement. GAP Insurance is a cost effective method of reducing risk of negative equity in the event of a write off. |
| Disposal |
| You are appointed as an agent of the Leasing Company and are responsible for introducing a purchaser. It is usual for you to receive 98% of the sales proceeds as a rebate of rentals after deduction of any balloon payment. You are liable for the shortfall should the sale price not cover outstanding rentals due. We will be delighted to discuss taking the vehicle back
in part exchange. |
