Funding Your LCV Fleet

Finding the right funding solution

When managing an LCV fleet, choosing the right vans for the job isn’t the only big decision you’ll have to make. With so many ways to fund your vans, selecting the most cost-efficient funding method is just as important.

Whether you’re looking to spread the cost or share the risk – our flexible funding options have got you covered.

Weigh up the pros and cons of each funding method

Contract Hire Flexible Rental Finance Lease

What’s involved – the arrangement:

  • Initial rental + fixed monthly payments.
  • Contract typically between 24 and 48 months.
  • Hand vehicle back at end of contract duration.
  • You cover the cost of excess mileage and damage beyond reasonable wear and tear.
  • Option to include a Service, Maintenance and Repair (SMR) plan.

  1. The leasing company bears the risk of uncertain residual values.
  1. Option to include service and maintenance plans with expert EV technicians.
  1. Reclaim 100% of VAT on SMR packages.
  1. Monthly payments are 100% tax-allowable.

  1. Potential end of contract costs (VWFS | Fleet waives damage costs up to £100 and acts per the BVRLA Fair Wear & Tear Guide).
  1. Early termination charges apply.

What’s involved – the arrangement:

  • Long term rental of 28+ days.
  • Option to change vehicle mid-term.
  • Can easily extend the rental period.
  • Includes 24/7, 365 day breakdown cover.

  1. All vans are no more than 18 months old.
  1. Rigorous service standards and includes Road Fund License.
  1. Delivery and collection available UK wide.

  1. Monthly costs are often more expensive when compared to Contract Hire and Finance Lease equivalents.
  1. Excess mileage charges, make it less attractive than a Finance Lease.

What’s involved – the arrangement:

  • Initial rental + fixed monthly payments.
  • Contract typically between 24 and 48 months.
  • Two end of contract options depending on preference and budget.
  • No end-of-contract mileage or damage charges.
  • Option to include a service and maintenance plan.

  1. Ideal choice for businesses who may find it difficult to predict annual mileage.
  2. Option to include service and maintenance plans with expert EV technicians.
  3. Reclaim 100% of VAT on SMR packages.
  4. Monthly payments are 100% tax-allowable.
  5. Option to retain the vehicle at the end of the contract for a small ‘peppercorn’ rent.

  1. With Finance Lease your business is bearing the risk of unpredictable residual values.

Make the most of your taxable benefits

Taxable benefits: leasing

  • 100% of monthly payments are tax allowable against pre-tax profits on LCVs. For example, if a van’s lease costs were £500 a month with corporation tax at 19% FY 23/24, you can allow £1,140 a year (£6,000 x 19%).
  • Enjoy a 100% first year allowance against your corporation tax bill when you lease a brand-new LCV via a hire purchase agreement – through a limited company. Vehicles leased under any agreement where the company doesn’t own the vehicle do not qualify.
  • Claim 100% of VAT back when a commercial vehicle is used solely for business purposes.
  • Service, maintenance and repair costs are 100% tax allowable. You can also reclaim 100% of VAT.

Taxable benefits: purchasing

  • Enjoy a 100% first year allowance against your corporation tax bill when you purchase a brand-new LCV outright – through a limited company.
  • When you sell the LCV, you’ll only pay corporation tax on the proceeds. This 100% allowance gives you a significant tax advantage over the traditional annual writing down allowance.
  • The new 100% full expensing for qualifying plant and machinery available until March 2026 allows companies to write off the cost of investment in one go.
  • 100% of finance agreement interest charges are tax allowable. 100% of VAT can be claimed for LCVs if you are VAT registered.
  • Service, maintenance and repair costs are 100% tax allowable. You can also reclaim 100% of VAT.

Learn more about the latest available eLCV grants

Support and grants are available to help with eLCVs. Find out more with our funding advice.

Specialist LCV service, maintenance and recovery support

Our 24/7, 365 days driver support service, Driverline, is here to help increase fleet uptime. Our team are available on the phone and via our web app if you need roadside assistance, accident management or maintenance bookings, such as same-day servicing and repairs.

Here to help

Our LCV experts are on hand to help you find a fleet funding method that offers the optimum financial solution.

Once we’ve found a solution that works for you, you’ll benefit from transparent pricing, fixed monthly payments, and a negotiated damage waiver for each vehicle with the option to pool mileage.