Q&A Special: PCP Finance - PCP versus PCH

Q: Am I better off choosing a Personal Contract Hire (PCH) scheme over a PCP?

A: One of the advantages of contract hire for businesses is that 100% of the VAT on each monthly payment can be claimed back if the car is only used for business, and 50% if the car is used for commuting to and from work, and private mileage.

This doesn't apply to private individuals, so you won't save money over a comparable PCP deal. As with PCP, you can arrange a maintenance contract to cover routine servicing, but you can't buy the car at the end of the agreement. PCH is like a long-term rental car.