How Rapid Vans can save you money
We've been selling vans for more than 40 years. While the vans might have evolved, our commitment to delivering excellent deals has never wavered. We source thousands of vans directly from the manufacturers, allowing us to negotiate fleet discounts that we pass on to our customers. Your new van will be delivered to your doorstep by our franchise dealer partners, complete with a full manufacturer's warranty and service network.
We place large orders for vehicles, ensuring a reliable stock of commercial vehicles at incredibly low prices. But that's not all - due to the substantial volume of business we conduct, we have secured advantageous financing terms with our funder. This enables our customers to benefit from the lowest interest rates and, in most cases, with no document fees.
No matter if you are a Sole Trader, Partnership, Limited Company, or an individual seeking a lifestyle vehicle, we can provide you with exceptional deals that come with complete transparency and free delivery throughout the UK. Rest assured, there are no hidden charges to worry about.
FINANCE LEASE
Finance Lease is favoured by new start businesses and Sole Traders, particularly those who are not registered for VAT and have limited initial funds.
To make the monthly payment more affordable, a balloon payment based on the residual value is payable at the end of the term. It is highly recommended that the deposit, also known as the higher initial rental, should be a minimum of 10% of the sale price. This will significantly enhance the likelihood of the funding proposal being accepted.
As this is a lease, VAT is charged on the monthly payments, referred to as rentals, rather than on the sale price of the van. If you choose to upgrade before the end of the term, you can request a settlement figure and choose to either part exchange or sell the van. The difference between the sales price and settlement is referred to as equity; this is yours to keep or use as deposit on your next van.
We recommend Mobilize (Nissan and Renault finance) as our preferred funder due to their commitment to treating all customers equally. They offer an attractive fixed low-rate APR of 8.9% with no administration or document fees.
HIRE PURCHASE
Hire Purchase is a traditional financing method that has recently become more popular due to the government's introduction of preferential write-offs on vans.
If your business is generating profits and has a healthy cash flow, it is absolutely worth obtaining a quote. We highly recommend consulting with your accountant for expert advice in this matter.
To initiate the purchase, you'll need to make a down payment equivalent to at least the value-added tax (VAT) on the sale price. The good news is that you can request a refund for this VAT amount within the same VAT quarter.
It is highly recommended that you make an additional deposit of at least 10% of the net sale value. By doing this, you will stay ahead of the van's depreciation.
You can lower your monthly payments even more by considering the possibility of including a balloon payment at the end of the term. The future trade value is calculated based on the anticipated annual mileage and depreciation. By making the final balloon payment, you can easily take ownership.
We recommend Mobilize (Nissan and Renault finance) as our preferred funder due to their commitment to treating all customers equally. They offer an attractive fixed low-rate APR of 8.9% with no administration or document fees.
CASH PURCHASE
You can trust Rapid Vans to deliver, and we gladly accept cash payments in the form of BACS or bank transfer. Feel free to check out our reviews to see the satisfaction of our customers.
CONTRACT OPTIONS
Contract Hire, also known as an operating lease, is a fixed term contract and is dependent on mileage and the condition of the vehicle. Exceeding the agreed mileage or returning the vehicle in a damaged condition will result in additional charges. The flexibility of this funding method is limited compared to other options and terminating it early can be costly. While it may be suitable for certain industries, our experience indicates that it is not ideal for heavy use, building trades, or couriers with high mileage requirements. We are always willing to quote for comparison.
What’s the best way to fund my new van?
While there isn't a straightforward solution, historical evidence suggests that Finance Lease is particularly well-suited for Sole Traders and businesses that are not VAT registered, especially when there is only a small deposit available.
Instead of paying the VAT upfront as deposit, the VAT is charged on the monthly rentals spreading the cost. To make the monthly payments more affordable, a balloon payment based on the residual value can be made at the end of the term. We suggest that the deposit, known as the higher initial rental, should be around 5-10% of the sale price, this will increase the likelihood of the proposal being accepted and your payment will more likely run parallel with depreciation.
Based on our experience, if you stay within the agreed mileage and make an initial deposit of around 10%, you can upgrade your van after just 3 years of a 5-year agreement.
Finance Lease offers great flexibility, allowing you to easily upgrade your vehicle before the lease term ends. You have the option to settle the agreement by either part exchanging or selling it to a third party. Plus, any equity generated is completely yours to use towards your next van.
If your business is already established, registered for VAT, and has a stable cash flow, then Hire Purchase presents an excellent opportunity. The minimum deposit required is the VAT on the sale, although we highly recommend considering an additional 10-20% if feasible.
Capital Allowances
Tax relief schemes known as capital allowances offer businesses the opportunity to deduct the cost of specific assets, like vans, from their taxable profits. Various capital allowance options exist, and we have outlined them below.
Annual Investment Allowance
Vans are subject to various regulations based on their emissions and the date of purchase. Vans are primarily divided into two categories: those emitting above 75 grams per kilometer and those emitting 75 grams per kilometer or less.
If you buy a van that emits more than 75 grams per kilometer, you may be eligible for a capital allowance through the Annual Investment Allowance. This will enable you to deduct the entire cost of the van from your taxable profits in the year of purchase, up to a certain limit. As of July 2023, the limit stands at £1,000,000.
Depending on your van finance arrangement, you may be eligible to claim the payments you have not yet made after you begin using the van. Keep in mind that typically you cannot claim interest payments or any charges that occur during your agreement.
The amount you may be eligible to claim depends on your individual situation, and it's crucial to understand that we do not provide financial advice. If you are uncertain about the potential claimable amount, consider consulting with a certified tax professional.
Selling the van after claiming the Annual Investment Allowance could result in a tax liability, depending on your specific circumstances.
First Year Allowance
If you buy a van that emits 75 grams or less of emissions per kilometer, it will be considered a "low-emission" van. By owning a low-emission van, you may qualify for the First Year Allowance. This means that you can potentially deduct 100% of the van's cost from your taxable profits in the year you purchase it. For further details about the First Year Allowance, please visit GOV.UK.