A hidden gem for numerous reasons.
Purchasing an electric vehicle using a finance agreement may be beneficial for a number of reasons, one being the 100% First Year Allowance (FYA) against taxable profits; claimable in the first year of the agreement, or carried over into subsequent tax years. Another important point to consider is that there are no mileage restrictions.
Electric vehicles are updated much like your mobile phone. Most fossil-fuelled vehicles seen on the road today haven’t been updated since leaving the factory, and generally become less efficient as time goes on.
If you would like to take a long-term approach, the current grants may provide a rare moment to purchase a brand new electric vehicle at a significant reduction to the list price.
Hire purchase contracts are normally structured so that you take ownership of the vehicle following your final payment. Hire purchase finance agreements usually last from three to five years, but some can last up to seven years.
A hire purchase finance agreement with a deferred payment, often called a balloon payment, can help to keep your monthly payments lower by deferring a fixed percentage of the cost of the vehicle to the final payment. You will normally be expected to pay a 10% deposit with this agreement and you will also be obligated to pay in full for the vehicle as there is no option to return it.
A business contract purchase is generally structured in a similar way to a hire purchase with balloon but you will have the option to return the vehicle at the end of the contract term, and there is generally a mileage limit. The higher the mileage limit you choose, the more expensive the monthly payments will be.