SMEs often have just as much need for a business vehicle as larger companies with full fleets. However, the cost of a brand new car might seem prohibitive or off-putting. Choosing to lease a business vehicle could become the most affordable long-term option:
As long as the car is used solely for work purposes, it's possible to claim all of the VAT back on your leasing agreement. You will need to demonstrate this to HMRC in order to receive the benefit. If the vehicle is partially used in a personal capacity 50 percent of the VAT could be reclaimed.
In many cases, it's possible to add fixed-price servicing and maintenance to your finance package - this may be the best long-term decision to make. On a lease term, your company doesn't yet own the vehicle, so knowing that any unexpected work and repairs are covered is even more reassuring.
Paying for a new car on a monthly basis spreads out the cost and makes your company budget easier to manage. Purchasing outright requires you to have a lot of capital available upfront, and this might not always be easy or practical. Lease agreements do require a deposit, generally equivalent to the first three months' worth of payments - and then your monthly repayments will be lower.
One of the best things about choosing a car on lease is the ability to switch it for a brand new car at the end of the term. With lease agreements lasting just 24 or even 12 months, your business can be seen with a professional new vehicle every year. You also won't have to worry about depreciation when it's time to trade the model in.
To select a new car on finance for business use, please contact your nearest Lookers dealership. We'll guide you through the range and discuss your leasing options.