Car leasing is a great choice for those who prefer to drive the latest models more affordably. But knowing exactly what’s included in your lease, and who pays, can be confusing. Whether you’re looking for a personal lease or business leasing options, find out more about your car lease responsibilities below.
What’s included in a car lease?
Before leasing a car, it helps to know more about what’s included in your lease deal. This can be subject to change depending on your lender, but typically leases include:
- Road tax: Your road tax will be included in your monthly payments – no need to budget for this separately.
- Manufacturers’ warranty: Your lease car will come with a manufacturer’s warranty to cover any repairs or maintenance needed, which typically lasts 3 years. If your car is still under warranty, you don’t need to pay.
- Delivery: Most leasing companies, including ourselves at Car Leasing Made Simple, will deliver your car for free. All you have to do is sit back and wait for it to arrive.
MOT, servicing & repairs
Leasing a car comes with a range of benefits, including packages to make your life a little easier. The table below outlines what’s included in your lease by default, and what you can choose as an optional add-on:
| Feature | Included in your deal | Optional add-on |
| Vehicle | Yes | |
| Road tax | Yes | |
| Manufacturers warranty | Yes | |
| Delivery to the UK | Yes | |
| Servicing & MOT | Included in maintenance pack | |
| Tyres & breakdown cover | Included in maintenance pack | |
| Insurance | Insured lease options |
What’s the difference between personal, business and fleet leases?
Whether you’re looking for a new car at a more affordable price, or one or multiple cars for your business, it helps to know the difference between each type of lease:
Personal business leasing:
- Aimed at individuals for personal use. An alternative to buying a car outright in a more affordable way.
- 2-4 year lease term.
- Lower monthly payments, as you’re not paying for the full cost of the car, you’re only covering depreciation.
- No hassle at the end of the term, simply hand your car back to the leasing company.
- Flexible deals and terms, with road tax and delivery included, as well as optional maintenance packages.
Business leasing:
- Aimed at business and self-employed users, with tax and VAT benefits.
- Suitable for company cars and compatible with salary sacrifice schemes
- Flexible mileage options that may be better suited to higher annual use.
- Tax-deductible depending on CO2 emissions.
Fleet leasing:
- Aimed at organisations that require multiple vehicles.
- Fleet-wide solutions available, including Fleet Management tools and Whole Life Cost analysis.
- Blends different types of leasing to reduce overall costs.
- Includes real-time reporting and predictive mileage analysis.
Car leasing responsibilities: Hidden costs to look out for
If you’re new to leasing, the process can seem somewhat overwhelming, but it doesn’t have to be. Below, we’ll debunk some of the hidden costs of leasing to remove stress and help you settle into the process.
Excess mileage charges: Before you take out a lease, you’ll need to estimate how far you’ll be driving over the course of a year. It’s always best to be as accurate as possible with this figure, because if you exceed your mileage limit, you will be charged.
Excess wear and tear: At the end of your lease, your car will be inspected for wear and tear. For example, damages like dents, scratches and chipped windscreens can all lead to additional charges, so you must keep your lease car in the best condition.
Early termination fees: While leasing is a good choice for those who like to change their car more often, if you choose to terminate your lease early, you will be charged – often the majority of the remaining monthly payments.
Admin and processing fees: Look out for additional admin charges that might not be visible at first glance. They may also be referred to as arrangement fees. Here at Car Leasing Made Simple, we never charge a management fee, so that you can save at every step.
End-of-lease charges: You may be charged for missing service history, late returns or lost keys.
Road tax: While road tax is included in most leases, you may only be covered for a year, so make sure you familiarise yourself with the details of the contract to ensure your car is taxed.
Tips for understanding and reviewing your lease contract
With small print and technical jargon, it might not be easy to understand or review your lease contract, and a quick glance might already put you off! Here are some tips on how to review your lease contract to ensure you know exactly what you’re paying for:
Look for the basics: Determine how long your lease term is, and confirm how much you’ll pay upfront. From here, determine how much your monthly payment is.
Mileage allowance: Check how many miles you are able to drive each year, and how much you’ll be charged if you exceed this.
Find out what’s included: Look for road tax, servicing and maintenance, breakdown cover and insurance to determine what’s included, and what you’ll have to pay for yourself.
End of lease: Review fair wear and tear standards to find out what is acceptable and what you’ll have to pay for. Look for information on the return process and whether there are collection fees.
Early exit clause: Look out for how much you’ll have to pay if you end your contract early; this can be up to 50-100% of outstanding payments.
Other costs and fees: Look for admin and processing fees and late payment charges, as these can add up quickly.
Once you’re familiar with the terms of your contract and the charges you might face, ask for clarification on anything you’re unsure of – your finance company will be more than happy to help.
Car leasing is a great choice if you are aware of your responsibilities and options. You can save money by choosing a lease that includes maintenance cover and insurance in your monthly payment, and by keeping your lease car in the best condition.
Find out more about car leasing in our step-by-step guide to car leasing, buying vs. leasing guide and business leasing guide.