Personal Contract Purchase Explained
Personal Contract Purchase (PCP) is a new product developed to enable individuals to finance their vehicle whilst still retaining some or all of the benefits associated with a company car.
As the agreement is written in your name the normal "benefit in kind tax liability" doesn't apply. This facility can also be offered to those employees not normally entitled to a company car. Low deposit followed by a fixed monthly charge means that is easy to budget for and it is possible to provide all-inclusive maintenance and breakdown packages.
Who Owns the Vehicle at the End of the Agreement ?
The vehicle is supplied for a set period of time at a fixed rental. At the end of the agreement the driver may purchase the vehicle by paying the balloon payment (guaranteed future value) or simply return it to the finance company.
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Personal Contract Purchase