VW Transporter Lease

A finance lease is a contract that allows you to pay for a vehicle over a set period of time at fixed, pre-determined rates. On a VW, this period is usually four years. The finance lease model does not provide ownership of the vehicle at the end, and while it is possible (via a circuitous process) to buy the van after the lease is over, it’s not generally a good choice if you want to keep the van, and it’s not possible to do a conversion on a finance lease.

Even though the agreement is over four years (on average), most customers will part-exchange the van back to us for a new vehicle before the three-year point. This way, you always have a van that’s always under warranty, and you get the tax and VAT benefits (if applicable). As such, it’s worth nothing that all finance lease payments are plus VAT. If you’re VAT registered, you can claim the VAT back quarterly.

With a hire purchase (HP) agreement, you essentially pay the VAT as a deposit upfront. If you’re VAT registered, you can claim this back at your next VAT quarter. You then pay for the vehicle over 2-4 years. If you want to lower the monthly payments, then you can choose the option of a large final payment at the end of the agreement’s term.

Hire purchase allows you to own the vehicle once the contract is complete. With either agreement, you have the option to add upgrades to your vehicle, such as leather seats, body kits, upgraded alloys wheels, etc., and spread the cost over your monthly payments.

The primary difference between the two models is their passenger- and cargo-carrying capacity. If you need to carry more people, then the kombi model is probably best for you as it seats a total of five or six (including the driver). However, the extra seating does compromise the available cargo space. If you need to carry more cargo, then the panel van will be your best option. It offers seating for the driver and up to two passengers and has significantly more space in the back.

You can claim back the VAT on either version: panel van or kombi.

Yes! You can spread the cost of your upgrades and options over your monthly finance repayments and pay for the extras over time.

Whether it’s better to lease a vehicle or purchase it outright depends on the individual requirements of your company. If you want to claim the VAT back in full, then hire purchase may be best way forward, but a finance lease generally offers the solution with the lowest deposit and monthly repayments. It’s also an easy route to getting a brand-new van every few years.

While we can give you the finance facts, we can’t advise you on what to do in your circumstances. It’s always best to speak to your accountant to find out how to get the best VAT and tax benefits for your business.

When you lease a van, the deposit can vary. You will have to pay something up front, and this can range from some thousands anywhere up to half the value of the vehicle. Most of our advertised deposits start at around £3000 + VAT, but bear in mind that the more you put down up front, the less your monthly payments will be throughout the lease term.

The deposit payment is calculated plus VAT, and this can be claimed back by VAT-registered lease holders on a quarterly basis. (However, the situation is different for those who are registered for VAT on the Flat Rate Scheme. It’s always best to seek clarity from your accountant about the best option for you).

In the case of a hire purchase contract, a minimum payment of 20% of the value of the vehicle is required. This is equal to the VAT and is reclaimable. You can pay an additional deposit on top of this, if you wish, to lower your monthly payments.