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For many people, one of the greatest joys of going on holiday is taking charge of a brand new, state-of-the-art hire car and enjoying a week or two of hassle-free, pleasurable driving. One disappointment of returning home, as unconscious as it may be, is having to go back to using one’s older, less comfy car. Smart car users, however, have discovered a cost-effective way of bringing that luxury, care-free hire car experience into their everyday lives: contract hire car leasing.

Just like hiring a car, contract hire enables the driver to have direct access to one of the latest vehicles on the market, with no worries about having to pay the road fund licence, and the backing of a full manufacturer’s warranty. Contract hire, then again, actually improves on standard car hire in the following ways. Firstly, the contract hire customer is able to choose any make, model and colour of vehicle, as if he or she were purchasing a car direct from the manufacturer. Secondly, the contract hire customer is granted undivided use of this same vehicle for the entire length of the contract period (usually three years). Thirdly, the monthly rates for contract hire are very favourable, since they are, for the most part, derived from the value of the car’s depreciation over the contract hire period, rather than on its total sale price when new.

One reason why car leasing is so popular with many businesses, is that there is so much scope for accounting and taxation incentives. These benefits vary according to the type of lease chosen, with some types of lease having more than one of these benefits. One of the most widely recognised incentives of vehicle leasing, is a business’s ability to reclaim at least 50% of the VAT due on each monthly lease settlement. This is a benefit applicable for VAT-registered businesses, which take out either a contract hire or finance lease agreement.

A second incentive is a business’s ability to offset the leasing costs against corporation tax. For van leasing under a contract hire agreement, 100% of the monthly lease payment can be offset against corporation tax. For cars under the same contract hire agreement, the amount may be lower, depending on the emissions from the car. For those companies that prefer to keep their lease payments off the balance sheet (in order, for example, to reduce their official outgoings so that funds can be allocated to another area of the business), undertaking a contract hire agreement will provide the solution they seek. On the other hand, should a business feel it could profit from incorporating lease payments as an asset on its balance sheet (so as to attract finance, for example), a finance lease will be the answer.

A house and a car are often the two most high-priced domestic purchases a householder can make. Just as it is possible to rent a house with recurring payments, so too is it possible to have exclusive use of a car without buying it, a process known as car leasing. Moreover, whilst it is generally accepted as economically prudent to rent, rather than stretch oneself financially with mortgage commitments and expensive deposits, it makes even more economic sense to also choose car leasing over car purchase. There are two main reasons for this.

Firstly, car leasing costs are basically based on how much a vehicle depreciates over the term of the lease, rather than on its purchase price. Property rentals, however, strongly reflect the overall value of the property in question. Therefore, whilst some house rental payments can in some cases be as expensive as a monthly mortgage fee, car leasing costs are generally cheaper than those incurred by embarking on a monthly vehicle finance purchase plan.

Secondly, whilst renting a property will mean foregoing the benefits of owning what is likely to be an appreciating asset, there is little to be said in favour of owning a depreciating asset such as a car. Indeed, by limiting a car lease to three years, with no further commitments, a householder will profit from a full manufacturer’s warranty, whilst totally avoiding the vehicle’s long-term depreciation risks.

There are several ways in which thinking ‘outside the box’ can give additional advantages through vehicle leasing.
One way in which some businesses and individuals view vehicle leasing, is as an opportunity to defer making up their mind on whether or not to purchase a vehicle. By taking out a contract purchase agreement, the lease customer reserves the right to purchase the vehicle at a pre-agreed price at the end of the car leasing contract hire period.  However, if the lease customer decides not to purchase the vehicle, then it can be returned to the leasing company without any further obligation. This ‘best of both worlds’ option can also benefit the customer, should a successive sale of the vehicle bring in more money than the purchase price paid to the car leasing company.

A second way of taking a ‘left-field’ advantage of vehicle leasing, is to make good use of the capital saved on monthly lease payments over more expensive monthly purchase finance payments. These savings can, for example, be used towards a fund for increasing the down-payment on any follow-up lease. Since a higher down-payment will result in lower monthly lease payments, this saving cycle can continue even more effectively in preparation for the next follow-up lease. A third idea is to always select a vehicle that tends to keep its value better than others. The rate of depreciation on such a vehicle will be lower, which will in turn lower the customer’s month-to-month lease payments.

For some car drivers, personal contract hire simply seems ‘too good to be true’ and they often expect there to be some kind of a ‘catch’ with this popular form of car lease. Worried motorists can however rest assured that, provided a few simple steps are taken, they will have nothing to fear, and everything to gain, from contract hire.

The first step is to ensure the leasing company can supply the make and model of your choice at a competitive rate. Large, established independent vehicle leasing companies will often provide the best deals, with regular features such as paid road fund duty and the promise of a full manufacturer’s warranty all thrown in.

The second step is to check out the leasing company’s credentials. Membership of the British Vehicle Rental and Leasing Association (BVRLA), for example, means that the company will pledge to treat customers with honesty and integrity. The BVRLA will also act as arbiter in the event of any complaint or dispute.

The next step is to check what the financial penalties are for wear and tear or extra mileage when the vehicle is returned to the vehicle leasing company. If mileage restrictions appear too stringent it may be advisable to negotiate an extended mileage allowance. It is solidly advisable to take out gap insurance, a protection additional to standard vehicle insurance, that will cover the customer’s monthly commitments to the vehicle leasing company should the car be destroyed or stolen.

Financing a new car can be an expensive and stressful process. This is one of the reasons why many motorists are increasingly turning to car leasing as a way of securing a new vehicle. Many car buyers will need credit of some kind in order to make a purchase. The problem is that car finance can be costly – with large deposits, excessive monthly repayments and, possibly, even a considerable final payment required. Bank loans can be similarly expensive.

For this reason, some desperate car buyers will try and secure credit from other means. Using a credit card, provided it has a sufficiently high limit, will of course result in lower monthly payments, but the payback period could easily extend way beyond the desired length of time the buyer will wish to keep the car, resulting in a vast debt with nothing to show for it. A similar problem occurs with an extension on a property mortgage to pay for a car. Since few cars will ever last as many years as a comfortably long, low monthly rate mortgage, the buyer is putting his or house at risk for a vehicle with only a limited lifespan. With contract hire car lease however, the customer only has to pay for that part of the car’s value they use over the two to four year vehicle lease period, resulting in exclusive use of a brand new car at affordable monthly rates.

There are three major myths regarding vehicle leasing: that it is an ‘executive’ option, that it only permits access to powerful saloons, and that it is akin to the lavishness of luxury car hire. The first of these mistaken perceptions, that car leasing is only for business executives, is a distortion of the fact that certain businesses can secure taxation and VAT advantages from leasing. However, this does not mean that leasing companies are not interested in enticing private car drivers. On the contrary, leasing options, such as personal contract hire and personal contract purchase are only offered exclusively to private car drivers.

The second misconception, that only large gas guzzlers are available for leasing, probably stems from the fact that vehicle leasing does not incur the ‘benefit in kind’ taxation of company cars, and is therefore especially advantageous to those senior-level staff who opt for larger vehicles. A reputable leasing company will gladly source any make or model requested by a potential customer, regardless of the vehicle’s colour, size or style.

Lastly, car leasing is not the same as car hire. With car leasing, the customer enjoys exclusive access to the same vehicle during the entire lease period. Car leasing is also much cheaper than car hire, since rates are based on the depreciation value of the car over the lease period, rather than on its total value. There was a time, long ago, when smoking was considered good for your health. It is thought that car ownership will, one day, be similarly ridiculed as the province of the deluded mind.

Car ownership, far from something to boast about, actually demonstrates huge economic mismanagement and wastefulness. Once a new car leaves the dealer’s showroom, its value starts to plummet dramatically. By the end of the first year it will have lost, on average, about a third of its original value. Buying a second-hand car, on the other hand, not only traps the new owner in the car’s continuing downward spiral of depreciation, but also eats heavily into the owner’s finances, by way of extra maintenance and repair costs.

However, car leasing is increasingly seen as the smart, financially perceptive, method of securing a new, reliable vehicle. Monthly leasing costs, as part of a contract hire, are far lower than the equivalent monthly costs for vehicle purchase finance. This is because car leasing costs are based mainly on the depreciation value of the car, during the two to four year period of the lease agreement rather, than on its purchase price. Furthermore, at the end of the lease period, the driver can basically have the car collected by the lease company and switch to another new model, with no further expenses to pay.

When it comes to fleet hire most companies don’t understand that as well as their executive vehicles, it is also possible to lease commercial vehicles too. From flatbeds and dropsides to chassis cabs and transits, van contract hire is a cost effective and hassle free way to augment your existing commercial fleet or start from scratch if you never had this kind of requirement before.

Just like car leasing and contract hire, when you lease your vans you avoid the costs entailed with depreciation upon disposal, maintenance and even tyres if you negotiate your deal right from the outset.

The beauty of vehicle contract rental is that all the costs are covered from the outset. You get to find out how much the car will cost per month or per year and when you need to a vehicle replace you have none of the fuss of having to re-sell after a few years of depreciation. Leasing allows you, to rent a vehicle where your monthly premiums remain unchanged for the rental period. The drop in value is borne by the rental company. Because insurance and maintenance are all taken care of you have a predictable cost making budgeting simpler and time consuming factors such as reselling old units, dealing with garages and workshops can all be avoided.

Contract leasing your vehicles can mean that after the first year you should be able to get better terms on your monthly rental fees, the standard practice here in the UK is to request an initial payment to the value of the first three months followed by 35 standard monthly payments, for example. The mileage on these lease agreements is generally assumed to be 10,000miles per annum but you should be able to negotiate if your experience leads you to believe your vehicle usage will be different.

We find ourselves in what is being called an ‘austerity economy’, the government is cutting public spending while increasing the amount of cash that is being drawn from the public in the form of taxes. And that’s a fine economic model, obviously cutting spending while increasing income is the very definition of getting richer so how can you apply this to your fleet?

If your company owns its own fleet then obviously they’re liable for maintenance, upgrades and replacements, fuel, insurance, taxes, everything. That’s a lot of spend to keep your employees on the road.

But you need to keep your sales reps, agents and staff on the road so that’s unavoidable, right?

Well, not if you look into car leasing and contract hire options.

Contract leasing allows you, as a company, partnership or sole trader to rent a car where your monthly premiums remain unchanged for the rental period. The drop in residual value is borne by the rental company and not by you. Because insurance and maintenance are all taken care of you have a predictable cost making budgeting simpler and time consuming factors such as reselling old cars, dealing with garages and workshops can all be avoided. This is as true for van contract hire as it is for car rental.

Car rental on the other hand is much like rental only for longer periods and that means better terms for you.

Leasing your fleet vehicles can mean that after the first year you should be able to get better terms on your monthly rental fees, the standard practice here in the UK is to request an initial payment to the value of the first three months followed by 35 standard monthly payments, for example. The mileage on these contracts is generally assumed to be 10,000mpa but you could be able to negotiate if your experience leads you to believe your vehicle usage will be different.

There are loads of items that you can get for your car like mobile phone accessories. Lots of car accessories are very practical and useful. These are accessories like sat nav’s that can provide you with an easy way to get around and find where you are going. Good things about satellite navigation systems are that they are portable so don’t just have to be restricted to use in your car.

Sat nav’s not only give you directions but can also tell you where the nearest attractions are. It will be able to point you in the direction of the nearest food location or shopping area. You will also find lots of accessories available that you can use to make your car look a little nicer.

These beautification accessories are great for contract hire cars as this is the only type of modifications that you are allowed to make. However you can get away with some accessories that will make your car look that little bit nicer without having any modifications.

In this case we are looking at things like stylish hub caps, steering wheel covers and custom gear sticks. A steering wheel cover can not only make your steering wheel look nice and fit in better with your car but it will also provide added comfort.

Most people agree that a cars sound system is the single most important accessory that you can have. Car sound systems are becoming more affordable and now produce even better quality sound than ever before. You obviously need to choose a audio system that is made for your car so that the speakers can be hooked up correctly. After this it is all down to you own personal choices. It is always well worth visiting you local car or electronics store to see what kind of sound systems they have available. Lots of shops will also be able to hook the sound system up so that you can hear the kind of sound it will produce before you put any money down.

Buying a brand new car can be expensive and this is why many people now opt to purchase a contract hire car. The financing options of a contract hire car allow you to get a car that if bought new would be out of your price range. Some such cars that are available via this method are the Audi Q7, Volvo V7 as well as Porsche Cayenne.

As already one of the major benefits of leasing a car is that you are able to afford a much more expensive car than you normal would. Every 3 years or so you will be able to get rid of the car you have and get a brand new version or even a different car. If you are the type of person who wants to always have a new car then this is the option for you. You haven’t got to worry about getting rid of your old car either which can be a huge benefit especially in times like these.

Most cars will lose around 80 to 90% of their starting value by the time that they come to be sold. It can be frustrating to hang on to a car for far too long simply because it has no real value.

When going for a contract hire car you should consider some of the following. An open ended agreement is the most common and best for consumers. Unlike other contract type an open ended agreement means you will not have to pay additional costs. The only extra charge you could experience is an excess mileage payment. This happens when you exceed the pre-defined mileage allowance for your contract hire car. In most situations this is in the region of 10,000 to 15,000 miles per year for the duration of your contract.

Looking on the internet is an easy way to see which cars are available and maybe pick up a deal.

It would appear that a considerable number of people don’t actually know how car leasing works, so to help you decide if leasing is the right option for you, here’s a quick rundown of the basics.

Essentially, the leasing process consists of paying to use a vehicle for a given period of time, without taking proprietry rights of it or paying the full retail value. Contract hire is a similar process, except contract are usually run for a longer period of time.

You would firsty need to think about the type of vehicle you want to hire, before specifying this to the leasing agency. You will need to tell them what sort of vehicle you need, what functions it needs to have, how many people it will need to hold, etc. etc. so that they can provide the right vehicle for you. You would normally then be presented with several financial documents, which you will need to read carefully and then sign. Obviously something like an Audi contract hire is going to cost much more than a Skoda or an old Fiesta, so you’ll have to keep financial considerations in mind when choosing your hire car.

You will then usually have to wait from a decision from a financial lending facitility, who will usually decide quite quickly. Their decision will be based around your previous credit score & history, your job, current financial position, previous employment, etc..

Should you be successful, you’ll then be expected to exchange financial documentation, sign any requested forms and take delivery of the vehicle. Usually you will not receive access to your selected vehicle until all financial paperwork is completed and properly exchanged.

Once you’ve finished with the vehicle, you’ll be able to renew it, select a new vehicle (although this usually requires a new contract) or return it, ending the contract. When you do come to return the car, make sure you’ve followed all the obligations in the contract correctly and that you’ve returned it in at least the condition you took it in.

Fifteen years ago, chances are that no one in the UK would have known of the small Japanese car marque, Subaru. Those that were aware of these Asian autos saw them mainly as farming vehicles, purveyors of estate cars that farmers would use to transport their fence posts and sheep dogs from A to B when the trusty Land Rover was to big for the narrow country lanes, they were a less attractive option than van contract hire. Of course now the Subaru brand is widely recognized in Britain, mainly for its iconic now Impreza model, a popular choice for consumers looking into car leasing. What is intriguing is how Subaru gathered followers through a successful spell in top level motorsport, and interstingly, a video game.

The young Scottish really driver Colin McRae won his first world championship in a Subaru in 1995, the plucky young scot was a man of little words that let his driving style do the talking, and what style he had! McRae could only be described as frantic, he hustled his car over dirt, dust, ice and snow with reckless abandon, always fast, sometimes to the point of flipping and barrel rolling his car after hitting a rock, only to continue as if nothing had happened.

As McRae became relatively famous, dragging the success of the World Rally Championship with him, the viedo games publisher Codemasters enlisted his help for a console rally game in which McRae and his iconic Impreza took the staring roles. The game was praised in games journalism for its ultra-realistic physics and gorgeous visuals and sold in it’s hundreds of thousands. In a direct correlation with the success of the game, Subaru saw interest in the Impreza build and build with sales of the blistering quick WRX version particularly impressive.

Throughout the 2000′s the Subaru Impreza in its various guises became the boy racers ultimate dream. The 4WD beast became available to buy in deep metallic blue with gold rims, echoing the livery of the famous rally car. Today Subaru faces stiff competition from the Mitsubishi Evo X which is widely thought of as the better car and sells well through contract hire firms. But through the WRC, Colin McRae and that massively popular game, Subaru has been able to cement a place in the UK car market with a wide range of models from super-minis to 4x4s. Subaru is living proof that a strong motorsport heritage can translate into healthy sales figures!