Who enters the agreement?
With personal contract hire, an individual applies and is responsible for the agreement. With business contract hire, the eligible business is the customer and the vehicle use must fit the provider’s terms.
Directors, sole traders and newer businesses may be asked for additional information. Acceptance remains subject to the finance provider’s checks.
How rentals are displayed
Personal rentals are normally displayed including VAT. Business rentals are normally displayed excluding VAT, which means apparently smaller figures are not directly comparable.
Request a written quotation on the correct basis rather than converting the VAT treatment yourself.
Tax is circumstance-specific
VAT recovery, allowable costs and benefit-in-kind depend on the vehicle, use and business circumstances. Nationwide Motor Leasing does not provide tax advice.
Ask an accountant or tax adviser to review the current rules and your circumstances before ordering.
The practical comparison
For either route, compare term, mileage, initial rental, maintenance, insurance, expected use and return conditions. The applicant should be the person or entity genuinely responsible for the vehicle.
Do not use a business agreement simply to access a lower displayed ex-VAT figure. Eligibility and permitted use must be accurate.