Car Leasing Blog

If you go for a PCP contract, there is a fantastic way to benefit financially at the end of the contract, I will go through it step by step:

With a PCP Lease, there is an optional final payment at the end of the term, which is fixed by the finance company.

One of the benefits of this is that you can hand the car back to the finance company, another is that you can buy the car, then sell it.

When they set the MGEV (Final payment), they usually use around 85% of the predicted future value of the car (to cover their back). This means that if you play your cards right, you could make this 15% yourself (or even put it toward a new vehicle)

I always try to ring PCP clients before the end of the term to make an assesment of the value of their vehicle vs the sale price of the vehicle. I have even known clients take their car to the local dealership and get £300 - £1000 more than the final payment figure on the contract.

Food for thought isnt it?

Company car users have for a long time got confused over the differences between P11d values and OTR values, so I am going to give you a hand

P11d Values

The P11d value of the vehicle is the taxable (company car tax) value of a vehicle. Any extras you add to the vehicle (alloys,sat nav,etc) is then added on at list price to this value

OTR Value / Purchase Cost

This is the price you (or the leasing / contract hire company) has paid for the vehicle. The obvious view is that the inland revenue dont care wether you ‘got a deal’ or not, or how much you paid for an ex demonstrator, they still want their pound of flesh

I hope this gives some clarity on the subject

Bye for now