Personal Contract Purchase Deals Explained, PCP – leasing4u

Personal Contract Purchase (PCP) Private Individuals

One of two funding methods which we offer for private individuals wishing to opt out of a company car scheme or would like a car for private use. PCP also gives you the customer the same benefits if you lease a vehicle along with the option to own it if you wish.

PCP enables you to upgrade to a vehicle that might otherwise be unaffordable.

A guaranteed residual value is set by the Leasing Company at the start of the contract; this gives you a number of options at the end of the contract:

  • Sell the vehicle and use the equity as a deposit for the next vehicle
  • Keep the vehicle by paying the outstanding residual value
  • Keep the vehicle and re-finance the outstanding value over a longer period of time
  • Hand the vehicle back to the Leasing company at the end of the contract

Key customer benefits:

  • You can trade up to an otherwise unaffordable vehicle (eg. an executive/ sports car)
  • Hassle-free and cost-effective way to finance a vehicle
  • The convenience of an optional full maintenance service, at a fixed monthly cost, is optional.

What is PCP?

PCP is a conditional sale product offered through our Leasing Company to non-business customers. It is regulated by the Consumer Credit Act 1974 depending on the lessee’s status and value of the vehicle.

It is for private individuals who want a hassle free and cost effective way to finance and maintain a vehicle.

As a business user funder our Leasing Company’s offering of a Personal Contract Purchase (PCP) product is ideal for anyone wishing to opt out of a company car.

As this is a conditional sale agreement you cannot re-schedule the contract or extend the term.

You the customer have the option to purchase the vehicle, or to simply hand it back at the end of the contract period (subject to settlement of any excess mileage and ‘damage’).

You can include the same comprehensive service, maintenance and repair options offered through Contract Purchase, although you will be responsible for the annual review of the Road Fund Tax.

Finance payments are not subject to VAT.

If the optional service package is taken VAT is payable on the service costs.

How does it work?

At the start of the contract our Leasing Company sets the final payment amount under the contract.

You may choose to pay the final payment and keep the vehicle or return the vehicle in full satisfaction of the final payment.

The vehicle is registered in the hirer’s name. You can also enjoy the convenience of a full maintenance service, at a fixed monthly cost if you wish.

Road Fund License is only provided for the first year of the contract only.

How is VAT accounted for?

As this is a personal contract offered for non-business use there are no VAT or Corporation tax advantages.

What happens at the end on the Contract?

Hand the vehicle back to the Leasing Company. Any damage on the vehicle or missing service history, keys etc will be charged as detailed in the Leasing Company’s ‘Fair Wear & Tear Guide’.

You may choose to pay the final payment and keep the vehicle.

Re-Finance the final rental. 28 days notice is required prior to contract expiry date.

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Car leasing credit broker (not a lender) Leasing4u is a trading name of Blueroc Ltd - Registered in England number 05139277 Registered office Unit 4 Mallard Court, Mallard Way, Crewe, CW1 6ZQ; Data Protection Z8611873; Authorised and regulated by the Financial Conduct Authority, Firm Ref No 660124. All information contained in this website is current at the time of publication and whilst the greatest care has been taken over its compilation, leasing4u cannot be held responsible for any errors or omissions. Business Contract Purchase prices displayed do not include the price for RFL which is included in the contract, this additional amount will be shown on your confirmed quotation as a services cost. Please note it is illegal to enter into a finance arrangement on behalf of another person. Carleasing4u and leasing4u are registered trademarks and we may also be know as Car Lease 4u, Carlease4u, carleasingforyou, carlease 4 you. All photographic images are for illustration purposes only and may not depict the relevant model. We are a Leasing Broker Member of the BVRLA and our membership number is 1431. E & OE.