In a contract hire arrangement, the customer pays a fixed monthly amount for a designated period of

Not all small businesses have sufficient cash to buy a vehicle outright. Fortunately there is a range of car finance options available and you could always look at renting vehicles on a short or medium term basis. All capital cities are well serviced Melbourne and Sydney car hire is particularly competitive but you will find a range of rental providers in any good-sized town around Australia. In this article we look at a few of the options available to the small business owner.
best western french quarter landmark hotel In a contract hire arrangement, the customer pays a fixed monthly amount for a designated best western french quarter landmark hotel period of time and an agreed maximum number of kilometers. The monthly amount payable is based on factors such as the purchase cost of the vehicle, the agreed period of usage, kilometers driven and depreciation. Contract hire agreements work for a wide variety of businesses with a wide range of possible contracts that can be adapted to suit the specific needs of each organisation. Advantages of this type of agreement include low initial outlay, the ability to reclaim GST and the possibility of offsetting the monthly installments against tax.
Contract purchase operates in much the same way as contract hire. The key difference is that at the end of the agreed contract period your business can choose either to return the vehicle or purchase it at a price previously agreed. Many of the advantages of contract hire also hold true with contract purchase. The key additional advantage is the flexibility to leave the final decision about purchase until the last possible minute.
If you know in advance that you want to purchase the vehicle, but don t want to pay all the money upfront, then lease purchase may be the perfect solution for your business. A lease purchase agreement operates in much the same way as the contract purchase, but you commit at the start of the agreement to making a single final payment when the contract period ends. Once you do this, the vehicle becomes your property (and one of your assets for tax purposes).
If you know you want to use the vehicle long term but do not need to own it outright, one type of car finance that might suit you is the finance lease. In this type of agreement, you pay the entire cost of the vehicle, including interest, over an agreed period. Once you have made the final payment, you do not own the vehicle, but you can continue to use it on a peppercorn contract. Kilometre usage is agreed at the start of the lease period and as long as actual usage does not vary, monthly payments and interest remain fixed.
It is worth considering whether or not your business needs permanent use of a car. If your vehicle will only be employed sporadically, perhaps you might be better off just renting a car as and when you need it. The car rental best western french quarter landmark hotel market best western french quarter landmark hotel is very competitive and if your usage is fairly frequent, you might well be able to negotiate special rates. This could prove more economical in the long run.