Van Finance Lease

Van finance leasing is an attractive option for businesses and individuals in the UK who need a van without committing to full ownership. This flexible financing solution allows you to use a van while managing costs effectively, making it particularly appealing for companies looking to preserve capital and maintain up-to-date fleets.

What is Van Finance Lease?

A van finance lease is a type of agreement where you lease a vehicle from a finance company for a set period, usually between 2 to 5 years. During this time, you pay monthly rentals based on the vehicle’s depreciation and interest. At the end of the lease term, several options are available, including extending the lease or selling the vehicle.

Key Features of Van Finance Lease

1. Lower Initial Costs: Typically requires lower upfront payments compared to hire purchase agreements, freeing up cash flow for other business needs.
2. Off-Balance Sheet Financing: As the lessee does not own the asset, it can often be kept off balance sheets, potentially improving financial ratios and tax efficiency.
3. Flexible Terms: Tailor your agreement with flexible terms regarding mileage limits and contract duration to suit your specific operational needs.
4. Maintenance Options: Many finance leases offer maintenance packages as part of the deal, simplifying budgeting for running costs and ensuring vehicles remain in top condition.
5. VAT Benefits: VAT-registered businesses can often reclaim some or all of the VAT on their rental payments if used solely for business purposes.

How Does It Work?

– Choose Your Van: Select a van that meets your requirements from an approved dealership.

– Agree on Terms: Negotiate terms including contract length, annual mileage allowance, and whether maintenance will be included.

– Pay Monthly Rentals: Make regular payments throughout the lease term which cover depreciation plus any agreed interest charges.