The Difference Between Corporate Lease and Personal Lease

When your company hires a vehicle on your behalf this is known as Corporate hire. The company will rent a car for a long period of time usually for 1 to 5 years at the same rate for the duration of the contract. This option is perfect for the busy business man that required a vehicle to get around the city and often travels to Dubai. Hiring a vehicle through your business works out a lot cheaper than a personal hire lease. When you hire a car through personal hire the payments are worked out differently. Apply for a fixed rate offer or pay for fuel only deal. Once the contract has ended simply pay the outstanding charges and hand back the keys.

Why Corporate Leasing is the Better Option

When you hire a vehicle through your company you will be rewarded with a number of different benefits. Claim back on tax. You can claim up to 50% back on your monthly payments and up to 100% for the VAT on the maintenance agreement. By leasing a car, you won’t be wasting money on a depreciating asset that loses money the more you drive it. Many agencies offer Dubai car leasing services, which are second to none.

Better accounting solutions allow you to keep the agreement “off the balance sheet”

A few drawbacks to consider with this option:

• You will not own the vehicle once the loan contract has ended
• You will be charged for any wear and tear on the vehicle at the end of the lease contract
• Beware of mileage restrictions that could end up costing you a lot in penalty charges
• Make sure that your rental agreement covers the cost of maintenance

Maybe You Would Prefer a Personal Hire Contract

A personal hire contract is very similar to a corporate lease contract with one main difference. Once you have made all the payments you get to keep the car. It is your responsibility to take care of the monthly payments for the duration of the contract between 2 and 3 years. Your car will be subjected to a mileage cap and maintenance will be for your account. Business leases usually work out as a better deal for your pocket unless you do a lot of personal traveling. When you travel for personal reasons in a corporate lease vehicle the mileage you do must be deducted because those miles will be subject to VAT charges.

A Corporate Lease Offers More Security

There is a lot more security when it comes to a corporate lease as there is hardly any chance of fraudulent activity. This is because the company that signs the contract will be completely responsible in every way. Different drivers will be able to legally drive the vehicle if it is on a corporate lease. If the vehicle gives trouble, simply swap it out for another one while yours is being repaired. The cost of the repair will in some cases be taken care of.