Contract Hire in Ireland
Contract Hire in Ireland is basically a rental agreement for the use of a car but it will have different benefits for private and business users.
Contract Hire in Ireland for the Business Renter:
Contract Hire is a tax deductable method of financing the use of a company car or providing the use of cars to employees. For the financially astute this is an ‘operating lease’ which will be a deductable expense on your P&L.
How it works:
Contract hire is a rental agreement between you and a contract hire company to rent a car or van for a fixed period of time. Contract hire companies in Ireland will often provide a ‘full service’ option with the hire. This means that all service and maintenance costs are covered by the contract hire company. This is why it is important to use LeaseBamIreland to find a ‘local’ contract hire company. If you live in Cork you do not want to send the car to Dublin for servicing.
Finance Bit:
Contract hire in Ireland will typically be cheaper than a finance lease because the value of the vehicle at the end of the term is taken into account and it is given back. The monthly rental charged is calculated based upon the cost of the vehicle, the contract period and the anticipated resale value It is also takes into consideration the predicted mileage, service and maintenance costs, together with any additional services
Advantages of Contract Hire in Ireland to the Business User:
- Contract hire is cheaper than finance leasing.
- No initial capital outlay, so it releases capital for more productive purposes.
- Elimination of wasteful depreciation and end of life disposal issues.
- Can provide employees with new cars without incurring additional expense.
- Fixed rentals aid budgeting and forecasting and are a protection against interest rate fluctuations.
- Rental payments are deductible for tax purposes.
- All running and car maintenance costs can be included in the hire Contract, making budgeting and fleet running costs easily identifiable and transparent.
- Single monthly outlay improves cashflow
Contract Hire in Ireland for the Private Renter:
Contract Hire for the private renter is a method of financing the use of a car without using fincane credit or borrowing money up front to pay for the car.
How it works:
Contract hire for the private renter is a rental agreement between you and a contract hire company to rent a car for a fixed period of time. Contract hire companies in Ireland will often provide a ‘full service’ option with the hire. This means that all service and maintenance costs are covered by the contract hire company. This is why it is important to use LeaseBamIreland to find a ‘local’ contract hire company. If you live in Cork you do not want to send the car to Dublin for servicing.
Finance Bit:
Contract hire in Ireland will typically be cheaper than a finance agreement or borrowing because the value of the car at the end of the term is taken into account and it is given back. The monthly rental charged is calculated based upon the cost of the vehicle, the contract period and the anticipated resale value It is also takes into consideration the predicted mileage, service and maintenance costs, together with any additional services.
Advantages of Contract Hire in Ireland to the Private User:
- Contract hire is cheaper than finance leasing.
- No initial borrowing or financing outlay, so it releases you cash for other purposes.
- Elimination of wasteful depreciation and the fall in resell value.
- You can have a new car every year or two years with no additional borrowing.
- Fixed rentals aid budgeting and are a protection against interest rate fluctuations.
- All running and car maintenance costs can be included in the hire Contract, making costs easily identifiable and transparent.
