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Home >> The Garage
The Garage
PFC Mortgages have teamed up with Compass Contract Hire to save you money on your vehicle funding.
Compass Contract Hire is one of the country’s most successful vehicle sourcing companies. Established over 15 years ago, they have a track record of experience, expertise and excellent customer service.
From time to time very special offers will be emailed to our customer database, where via a simple click through you can request a quotation request.
If you are not registered on our database Click Here
Please click on the links below to view a selection of our offers:
For a
quotation now please
click
here
For the range of vehicle funding options and the comparison chart, click on the headings below
Contract hire
Contract Purchase
Personal Contract Purchase
Finance Lease
Lease Purchase
Comparison Chart
Contract Hire
Compass purchase the vehicle of your choice after agreeing on the contract term, annual mileage, maintenance options and monthly rental.
On termination of the contract, you simply return the vehicle to us and assuming the contracted mileage has not been exceeded and all accidental damage has been satisfactorily repaired you have no further involvement.
Services included in Contract Hire:
- Free sourcing and delivery of your vehicles.
- Road Fund Licence for the duration of the contract.
- Free collection of your vehicle at the
end of the contract.
Additional services which can be included:
- All routine servicing, mechanical repairs, batteries, exhausts and tyre replacement
- Replacement vehicle provided in the event of an accident or mechanical breakdown.
- Full membership of a motoring programme including Home Start, Road Side Assistance, Relay, Relay Plus and European Cover.
- Motor insurance, individual or fleet cover available.
- GAP insurance up to a maximum of £5,000.
Your only responsibilities:
Choosing the vehicle.
Choosing the service options.
Paying for fuel, oil and insurance.
The Benefits:
- Costs paid from income not capital.
- Fixed monthly rental for accurate budgeting and cash flow.
- Minimum initial expenditure, typically three months in advance.
- No capital tied up in a depreciating asset and no residual value risks on your vehicles (depreciation being the largest single cost).
- Routine servicing and maintenance costs can be covered.
- No purchasing or disposal hassles, providing constant mobility.
- The leasing company is able to reclaim all the VAT on the purchase price of the vehicle which is reflected in much lower monthly rentals to you, the customer.
- For new cars and VAT qualifying used cars, assuming some personal use, the current legislation allows you to reclaim 50% of the VAT on your monthly rental against your VAT liability. The other 50% can be offset against taxable profits.
- For non VAT qualifying cars and commercial vehicles current legislation allows you to reclaim 100% of the VAT, and offset 100% of the monthly rental against tax.
- Rentals allowable against tax.
- Costs 'off balance sheet' improving
gearing ratios and return on assets.
Disadvantages:
- As a fixed contract, it is designed to
run for a specific period of time and can therefore carry some
penalty if terminated early.
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Contract Purchase
Simply a combination of Lease Purchase and the service options of Contract Hire.
This option has been designed specifically for customers who are unable to register for VAT or who are partially VAT exempt and who require a fixed monthly rental with the option to include a maintenance package. Contract Purchase is popular with companies purchasing executive type cars covering a low mileage
Compass purchase the vehicle of your choice, having agreed on the contract term, annual mileage, service options, guaranteed option to purchase price and the monthly rental.
On termination of the contract, you can choose to either return the vehicle with nothing further to pay or to purchase it at the agreed option to purchase price written into the contract.
Services options included in Contract Purchase:
- Free sourcing and delivery of your vehicles.
- Road Fund Licence for the duration of the contract.
- Free collection of your vehicle at the
end of the contract.
Additional services which can be included:
- All routine servicing, mechanical repairs, batteries, exhausts and tyre replacement
- Replacement vehicle provided in the event of an accident or mechanical breakdown.
- Full membership of a motoring programme including Home Start, Road Side Assistance, Relay, Relay Plus and European Cover.
- Motor insurance, individual or fleet cover available.
- GAP insurance up to a maximum of £5,000.
Your only responsibilities:
- Choosing the vehicle.
- Choosing the service options.
- Paying for fuel, oil and insurance.
The Benefits:
- Fixed monthly rental for accurate budgeting and cash flow.
- Minimum initial expenditure, typically three months in advance.
- No capital tied up in a depreciating asset.
- If you don't purchase the vehicle at the end of your contract, any depreciation the vehicle may have suffered is NOT your responsibility.
- Routine servicing and maintenance costs can be covered.
- No purchasing or disposal hassles, providing constant mobility.
- VAT payable on service options only.
- Flexibility to retain the vehicle at the end of the contract.
- Vehicle shows as a balance sheet asset.
- Capital allowances claimable against tax.
Disadvantages:
- Cannot be shown 'off balance sheet'.
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Personal Contract Purchase
Compass purchase the vehicle of your choice after agreeing on the contract term, annual mileage, maintenance options and monthly rental.
On termination of the contract, you simply return the vehicle to us and assuming the contracted mileage has not been exceeded and all accidental damage has been satisfactorily repaired you have no further involvement.
Services included in Contract Hire:
- Free sourcing and delivery of your vehicles.
- Road Fund Licence for the duration of the contract.
- Free collection of your vehicle at the
end of the contract.
Additional services which can be included:
- All routine servicing, mechanical repairs, batteries, exhausts and tyre replacement
- Replacement vehicle provided in the event of an accident or mechanical breakdown.
- Full membership of a motoring programme including Home Start, Road Side Assistance, Relay, Relay Plus and European Cover.
- Motor insurance, individual or fleet cover available.
- GAP insurance up to a maximum of £5,000.
Your only responsibilities:
- Choosing the vehicle.
- Choosing the service options.
- Paying for fuel, oil and insurance.
The Benefits:
- Costs paid from income not capital.
- Fixed monthly rental for accurate budgeting and cash flow.
- Minimum initial expenditure, typically three months in advance.
- No capital tied up in a depreciating asset and no residual value risks on your vehicles (depreciation being the largest single cost).
- Routine servicing and maintenance costs can be covered.
- No purchasing or disposal hassles, providing constant mobility.
- The leasing company is able to reclaim all the VAT on the purchase price of the vehicle which is reflected in much lower monthly rentals to you, the customer.
- For new cars and VAT qualifying used cars, assuming some personal use, the current legislation allows you to reclaim 50% of the VAT on your monthly rental against your VAT liability. The other 50% can be offset against taxable profits.
- For non VAT qualifying cars and commercial vehicles current legislation allows you to reclaim 100% of the VAT, and offset 100% of the monthly rental against tax.
- Rentals allowable against tax.
- Costs 'off balance sheet' improving
gearing ratios and return on assets.
Disadvantages:
- As a fixed contract, it is designed to
run for a specific period of time and can therefore carry some
penalty if terminated early.
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Finance Lease
Finance Lease gives you the advantage of running a fleet without having to purchase the vehicles. At the end of the lease period you would sell the vehicle to an independent third party and retain up to 98% of the sale proceeds.
This refund provides an excellent opportunity to fund the deposit of your next vehicle.
There is no large initial capital outlay leaving your capital free for more productive purposes. Fixed rental payments offer protection against inflation.
Compass purchase the vehicle of your choice, having agreed on the lease term, the monthly rental and a mutually acceptable residual value.
On termination of the contract, the vehicle can be sold, either by you or by Compass , and the proceeds offset against the residual value written into the lease. Should the proceeds exceed the residual value, you will receive the excess as rebate of rental.
Services included in Finance Lease:
- Free sourcing and delivery of your vehicles.
- Free collection and sale negotiation of
your vehicle at the end of your contract.
Services which can be included:
- Fulton vehicle maintenance package covering all routine servicing, mechanical repairs and maintenance e.g. tyres, exhausts and batteries
- Relief vehicle and recovery service.
- GAP insurance and motor insurance.
The Benefits:
- Compass fleet purchasing power on all makes of vehicles.
- Costs paid from income not capital.
- Fixed monthly rentals for the duration of the contract.
- The leasing company is able to reclaim all the VAT on the purchase price of the vehicle which is reflected in much lower monthly rentals to you, the customer.
- Minimum initial expenditure, typically three months in advance.
- No capital tied up in a depreciating asset.
- Rentals allowable against tax.
- For new cars and VAT qualifying used cars, assuming some personal use, the current legislation allows you to reclaim 50% of the VAT on your monthly rental against your VAT liability. The other 50% can be offset against taxable profits.
- For non VAT qualifying cars and commercial vehicles current legislation allows you to reclaim 100% of the VAT, and offset 100% of the monthly rental against tax.
- Flexible lease terms.
- A residual value (balloon payment) can be
included in the lease thereby reducing the monthly rentals.
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Lease Purchase
Effectively a Hire Purchase with a leasing payment pattern. The customer will own the vehicle after payment of an option to purchase fee. This option can be of particular value to companies not registered for VAT.
Compass purchase the vehicle of your choice, having agreed on a contract term, annual mileage, monthly rental and a mutually acceptable option to purchase price.
At the end of the contract you pay the option to purchase price and then own the vehicle. Alternatively Compass can sell the vehicle, and the sale proceeds are offset against the option to purchase price. Should the sale proceeds exceed the option to purchase price, you receive the surplus cash benefit.
Option to purchase price is commonly known as a balloon payment.
Service options included in Lease Purchase:
- Free sourcing and delivery of your
vehicles.
Additional services which can be included:
- All routine servicing, mechanical repairs, batteries, exhausts and tyre replacement
- Replacement vehicle provided in the event of an accident or mechanical breakdown.
- Full membership of a motoring programme including Home Start, Road Side Assistance, Relay, Relay Plus and European Cover.
- Motor insurance, individual or fleet cover available.
- GAP insurance up to a maximum of £5,000.
Your only responsibilities:
- Choosing the vehicle.
- Choosing the Compass Vehicle Maintenance package.
- Paying for fuel, oil and insurance.
- Paying for the Road Fund Licence.
- Should the sale proceeds be less than the
residual value, then you will be liable for any shortfall.
The Benefits:
- Minimum initial expenditure, typically three months in advance.
- Fixed monthly payments for accurate budgeting.
- VAT on monthly payments is not applicable.
- You can purchase the vehicle at the end of the contract.
- Flexibility to structure the option to purchase price or residual value.
- Routine servicing and maintenance costs can be covered.
- Capital allowances claimable against tax.
Disadvantages:
- Depreciation is your responsibility.
- There are limited tax advantages.
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Comparison Chart
| Meeting
Your
Requirements
|
Contract Hire |
Contract Purchase |
Hire / Lease Purchase |
Finance Lease |
Personal Leasing |
Personal Leasing |
| Finance/Taxation Issues |
| Accurate Monthly Budgeting |
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| Improved Cash Flow |
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| Minimum Capital Expenditure |
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| Fixed Interest Rate |
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N/A |
| Capital Allowances Available |
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N/A |
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| Rental Allowable Against Taxable Income |
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N/A |
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| Ownership of Vehicle + |
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++ |
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++ |
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| VAT Chargeable on Rentals |
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| VAT Recoverable on Monthly Rentals |
* |
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* |
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| VAT Recoverable on Purchase Cost by Network and Passed on to Customer
in Lower Rentals |
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| No Depreciation Risks |
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| Vehicle Running Requirements |
| No Vehicle Disposal Problems |
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| Reduced Administration |
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| On-going Advice/Support |
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| Road Fund Licence Provided ++ |
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| Replacement Vehicle in case of Breakdown ++ |
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| Fixed Charge Maintenance ++ |
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| VAT Chargeable on Services |
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| VAT Recoverable on Services |
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N/A |
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+ At end of contract with financing products
++ Optional
* Only
50% of the VAT relating to the finance element is recoverable if
private use or 100% if only business use. 100% of the service
element VAT is recoverable if business use.
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