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Finance Lease for Commercial Pickup Trucks

Finance Lease is a very popular pickup truck finance option amongst our customers as it gives you the best of both worlds. It gives you the benefits of ownership as you can take advantage of equity build up in the vehicle through a leasing product which can have a low deposit of just one payment upfront. VAT is only charged on the deposit and monthly rentals not the initial cost of the vehicle.

The vehicle is hired for a fixed monthly rental with a balloon payment covering the estimated residual value of the vehicle at the end of the contract. You are responsible for disposing of the vehicle at the end of the contact. If the sale price is above the predetermined balloon payment you will retain the equity, less a small charge from the leasing company. If the sales price is less than the balloon payment then you will be liable to cover the shortfall. The final payment is calculated using the mileage which is expected to be done in the vehicle over the contract.

With Finance Lease you may be able to finance up to 100% of the purchase price of a vehicle, minimising any deposit or capital expenditure on your behalf. You can agree the periodic rentals to be paid in return for the vehicle and, at the end of the term, you have the option to rent the vehicle for a nominal sum (known as a peppercorn rental) or to sell it and retain most of the proceeds. Your cash flow will be eased as VAT is payable on the rentals only, not the purchase cost of the asset.


  • Fixed monthly rentals
  • Choice of contract period from 24 to 60 months
  • Monthly rentals are up to 100% tax deductible
  • Potential to carry on using the vehicle at the end of the primary lease period
  • Additional line of finance that may not affect core banking arrangements
  • No strict mileage or damage penalties (please note that excess mileage and damage to the vehicle will affect its value at the end of your contract)
  • Monthly rentals can be lowered further through the introduction of a final rental at the end of the contract. This can be set at a value equivalent to a forecasted residual value or reduced in line with anticipated wear and tear on the used value
  • Available option to re-finance the balloon payment over a longer period of time
  • No need to be VAT registered
  • You retain the majority of the equity built up in the vehicle over the contract


  • Risk of fluctuations in the used vehicle market which could be a problem if you have opted for a balloon payment and the value of your vehicle is less than this.
  • Monthly rentals appear as a liability on balance sheet
  • There are operating risks associated with running the vehicle i.e Maintenance and servicing costs cannot be included


This would suit customers who:

Wants multiple options at the end of the contract.

Want to build up equity over the contract without taking ownership.

Do not want to be tied to a contract which penalises them for vehicle damage or excess mileage.