The world of cars for business purposes has changed a lot over recent years. It used to be that buying a company car was a fantastic perk, but nowadays, more companies, entrepreneurs and business people are choosing to lease from the likes of Car4Leasing. But why is this?
To help you decide if leasing is right for you, here are some of the main benefits of car leasing.
As anyone who has ever owned a car can tell you, the value of a vehicle is likely to depreciate. If you choose to buy your business car, when it comes to upgrading, you may be disappointed by the value you can get when reselling. However, by choosing to lease, you can forget having to worry about losing money through depreciation, as you simply hand it back when your contract is up.
Unless you choose to purchase through finance, you are faced with having to pay out a lump sum up to buy your business car. Plus, if you are a business owner with a new start-up, you may struggle to get a loan. Instead, leasing helps you to plan and budget, allowing you to choose a model with affordable monthly repayments.
Often, when buying a car, you are required to put down a large deposit, especially if you’re purchasing brand new from a showroom. If you don’t have that kind of cash available, this is where leasing may be for you. Many leasing options offer low deposits, with some requiring no deposit at all, meaning you can drive your car away with no upfront cost.
One of the main reasons many choose leasing is the tax benefits. As long as your company is VAT registered, you claim 50% of the VAT on monthly payment. Great news! Although if you plan to also used to car for personal use, you won’t be able to claim any VAT at all. However, you can claim monthly repayments against your company profits – up to 100% of the cost if the car is low emission.
Leasing a car for business purposes has some great benefits, including tax breaks, affordability and avoiding loss of value through depreciation. However, most leased cars can’t be modified, so they’re not the best option if you want to cover your vehicles with branding. In addition, most leasing contracts include charges for exceeding the annual mileage allowance, so always read terms and conditions carefully.