Business car Leasing
If you are looking for vehicles to operate your business or you want to provide company cars for employees then some form of car leasing is what you should be considering.
Car leasing for businesses allows your business access to a depreciating asset without the obligations of ownership and with the added incentives of tax savings via contract hire.
Leasing is a highly flexiblle way of acquiring the assets your business needs. It allows you to preserve working capital by financing vehicles over the course of their cash generating life.
In addition to the financial attractions of car leasing, there are administrative advantages as well such as updating company car records and organizing maintenance.
Personal car leasing
Since the major changes in taxation rules for company cars in April 2002 and with the benefit in kind taxation system in place, many company car users have questioned the validity and cost of a company car.
As a result, there has been an increase in the number of people investigating the use of alternative funding methods to alleviate their company car tax liabilities.
For this reason more and more companies are offering alternatives to company cars, such as an increased salary or tax free mileage allowances. The most popular of these has been the taking of a cash alternative for employees opting out of the company car scheme.
It is now possible for people to enjoy the inherent benefits of a company car without the tax burden. Personal contract hire, personal contract purchase or personal leasing are all offered in abundance and more and more individuals are realising the benefits of leasing car rather than owning one.
However, many people find it difficult to calculate whether the cash alternative is beneficial or how much they will have available to pay.
Check our "tax" and "cash4car" calculators in the company car tax section and please do not hesitate to contact us for unbiased advice.
Advantages of car leasing:
- Better Cash Flow. Car leasing gives you access to the car with minimal up-front payments and spreads the cost over time. You to pay for the car with the income it generates while minimizing the drain on your working capital.
- No debt. An operating lease preserves your credit options and does not influence your credit limit as it is generally not classified as debt but as expense (note that this advantage does not apply to finance leases!).
- Maximize Financial Leverage. Your lease can often finance everything related to the purchase and maintenance of the car and may free up cash flow to pay for items such as training.
- Simplified cash flow management. Lease payments are usually flat, making cash management more predictable and easier than with a variable rate loan. The fixed interest rate of a lease also helps if interest rates rise.
- Tax advantage. Operating lease payments are generally tax deductible just like depreciation charges but are made with pre-tax money. Cash purchases, in contrast, are made with after-tax money. Hire purchase agreements allow the lessee to claim capital allowances.
- Flexible contracts. Leasing contracts can be structured to fit your requirements. Use a car as long as you need it without owning it forever.
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Hedge against residual values. Depending on your end-of-lease option, just return the car to the lessor. You will not have the hassle of selling the used car or run the risks related to residual value.
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Drive a new car every two to three years and choose from any make or model from our special offers and options, please contact us whether you wish to lease or buy a new car and save money with our substantial discounts. |