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PCP vs PCH Calculator

Should you finance with PCP or lease with PCH? Enter both deal details to compare the monthly cost, total outlay, and whether you want the option to own the car at the end.

Reviewed by Richard Ross · Last updated April 2026

How many months' rental paid upfront

How PCP vs PCH Calculator works

How this comparison works

The calculator computes your PCP monthly payment using the standard annuity formula applied to the net financed amount (vehicle price minus deposit minus the present value of the GFV). The PCH monthly rental is entered directly from your quote. Total outlay for PCP includes all monthly payments plus the GFV if you choose to buy; total PCH outlay includes the initial rental and all subsequent monthly payments. The comparison shows which product costs less in cash terms for your specific deal.

PCP or PCH: the core trade-off

The choice between PCP and PCH comes down to one question: do you want the option to own the car? PCP (Personal Contract Purchase) is a credit agreement — your monthly payments cover the car’s depreciation, and a guaranteed future value (the balloon) lets you buy it outright at the end, hand it back, or use any equity as a deposit on the next car. PCH (Personal Contract Hire) is a pure lease — you rent the car for a fixed term and return it, full stop. Because PCH strips out the ownership option and the balloon, its monthly rental is often lower than the equivalent PCP payment, but you finish the agreement with no asset and no equity.

When PCP works out cheaper — and when PCH does

PCH usually wins on monthly cost and simplicity: fixed rentals, road tax included, and no depreciation risk because you never own the car. PCP can win overall when the car is worth more than its guaranteed future value at the end — that surplus is equity you keep, which effectively discounts the deal in hindsight. PCP also gives more flexibility: you can settle early, exercise voluntary termination once half the total amount payable is paid, or part-exchange at any point. If you always want a new car every few years and never want ownership hassle, PCH is typically the lower-cost, lower-commitment route. If you might want to keep the car or expect it to hold value well, PCP’s optionality can be worth the higher monthly figure.

Early exit and mileage: where the two products diverge

This is the biggest practical difference the monthly figure hides. PCP is a regulated hire-purchase-style credit agreement, so you have the statutory right of voluntary termination under sections 99 and 100 of the Consumer Credit Act 1974: once you have paid 50% of the total amount payable, you can hand the car back and owe nothing further, subject to condition. PCH has no such right — it is a hire agreement, so early exit is governed entirely by your contract, and leasing companies typically charge a fee of around 50% of the remaining rentals (this varies by provider). Both products set an annual mileage limit with excess-mileage charges, but on PCP unexpected depreciation is the finance company’s risk (you can hand the car back at the GFV), whereas on PCH excess wear and mileage are assessed against BVRLA guidelines when you return the car.

Worked example: £30,000 car over 48 months

PCP: £30,000 car, £3,000 deposit, £12,000 GFV, 6.9% APR, 48 months. Amount financed after deposit is £27,000, of which the balloon is deferred. A typical monthly payment lands around £430, so total paid before the balloon is roughly £3,000 + (48 × £430) = £23,640. Buy the car and you have spent about £35,640 in total; hand it back and you have spent £23,640 with nothing to show. PCH: the same car might lease at £350 a month with 3 months upfront. Total outlay = (3 × £350) + (45 × £350) = £16,800, and you return the car. On cash outlay PCH is clearly cheaper here (£16,800 vs £23,640 to walk away). But if the PCP car is worth £14,000 at the end — £2,000 above its £12,000 GFV — that £2,000 of equity narrows the gap and can be rolled into the next deposit. Enter your own figures above to see which wins for your quote.

Further reading

PCP and PCH differ significantly on ownership rights, early exit costs, and mileage risk — not just monthly payment.

Read the full PCP vs PCH guide →How to end a car lease early in the UK →

Frequently asked questions

What is the difference between PCP and PCH?

PCP (Personal Contract Purchase) is a finance product — you borrow money to buy a car and can own it at the end by paying the balloon. PCH (Personal Contract Hire) is a long-term lease — you rent the car and return it at the end with no option to buy.

Is PCH cheaper than PCP?

PCH often has lower monthly payments because you are paying only for the use of the car, not building towards ownership. However, you have no asset at the end. With PCP, if the car is worth more than the GFV, you have equity.

Are maintenance and servicing included in PCH?

Some PCH deals include a maintenance package for an extra monthly cost, covering servicing, tyres, and breakdown cover. PCP agreements rarely include maintenance. Always check what is included in your specific quote.

Can I end a PCH lease early?

Early termination of a PCH contract usually incurs significant penalties — typically 50% of the remaining rentals. Unlike PCP and HP, PCH is not regulated by the Consumer Credit Act so there is no statutory right to voluntary termination.

PCP or PCH — which should I choose?

Choose PCP if you want the option to own the car, might want to keep it, or expect it to hold value above its guaranteed future value — that surplus becomes equity you keep. Choose PCH if you want the lowest monthly cost, always plan to return the car, and prefer the simplicity of a fixed rental with road tax included and no depreciation risk. PCP offers more flexibility (early settlement and voluntary termination); PCH offers a lower, more predictable monthly figure. Run both quotes through the calculator to see the cash difference for your specific numbers.

Is PCP or PCH better for high mileage?

Both products set an annual mileage allowance and charge a pence-per-mile excess if you exceed it, so neither is inherently cheaper for high mileage — the allowance you choose drives the price. High mileage accelerates depreciation, which raises PCH rentals and lowers a PCP car’s end value (eroding any equity). If your mileage is genuinely high and hard to predict, PCP can carry less risk because you can hand the car back at its guaranteed future value regardless of what excess depreciation has done to the market price.

Does PCP or PCH build any equity?

Only PCP can build equity. If your PCP car is worth more than its guaranteed future value at the end of the agreement, that difference is yours — you can use it as a deposit on the next car or buy and sell to release the cash. PCH is a pure rental, so you never build equity: you hand the car back at the end with nothing to show for the payments. This is the main long-term financial distinction between the two products.

Can I switch from PCH to PCP part-way through?

Not directly — they are separate agreements with separate providers, so switching means ending your current agreement and starting a new one. On PCP you can settle early or use voluntary termination once 50% of the total amount payable is paid. On PCH there is no statutory exit, so leaving early means paying an early termination fee set by your contract, commonly around 50% of the remaining rentals. Get a settlement or termination figure in writing before committing to a switch.

These calculations are estimates based on 2026/27 HMRC and DVLA rates. Speak to a lender or qualified financial adviser for a personalised quote.