A business car lease can be a sensible choice. If your business is not that big or you’re just a starting-up, a car lease can prove convenient due to the lower cost, ease of availability and several other advantages.
Read on for more information about how a company lease can be beneficial for your business.
The monthly payments you pay during a full year can be completely offset against its taxable profit. This does not apply to cars which have 160g/km CO2 emissions. If the monthly rentals are not evenly spread out over the lease. Or if company has the option to buy the car at the end.
To get more information on the tax benefits take a quick look at: https://en.wikipedia.org/wiki/Business_contract_hire
In case you decide to buy a car – used or new, you are required to pay the amount upfront partially or full. Conversely, when leasing you have to pay only for portion of the residual amount which results in reduced monthly payment.
Likewise, the overall value of car lease is lesser than when it’s bought as the lease time is a short (normally 3 years). The amount for lease is the current value of the vehicle minus its price when you’re returning it. You have to pay the service charges and the interest amount. If the price of the vehicle during returning gets more than estimated, you will pay less.
It’s more efficient since you are able to afford the vehicle at a lesser price with a flexible instalment plan.
GAP (Guaranteed Asset Protection) insurance
With car lease, you have the advantage of GAP insurance. This insurance is a part of your lease agreement. It covers the rest portion of the vehicle price to be paid by the owner in the case it is totally damaged during an accident or stolen. This price is very smaller than if you were using new/used car. Especially a small business owners, it’s crucial to consider this factor when making the choice.
You are offered a full manufacturer warranty when you lease a car. Also, since you will be leasing the car for a brief amount of time, you will most likely have less maintenance issues.
At the end of the lease time, you have to hand over the vehicle to the lease company. At this point, you’re also given the choice to purchase the vehicle, or have another one for lease. You won’t have to worry about the car resale.
Being a small business owner, your company is likely to meet several fluctuations for a number of reasons. Hence, every pound that you spend is crucial.
To see our current business leasing deals please visit: www.southernvanhire.co.uk/offers
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