Car Leasing Can Save Cash

Small businesses that change company vehicles on a regular basis can save cash by leasing rather than buying. Small businesses are at their most vulnerable at the beginning of the venture; many owners plough their entire savings into the project. Vehicles bought for business purposes are usually loan or hire purchase cars. However, businesses that own vehicles fr a maximum of five years would benefit more from leasing. If you are starting a new business and need some company vehicles, leasing can be an ideal solution. Businesses are at their most vulnerable in their early stages of growth. Instead of paying a lump sum of cash for a number of vehicles it can be worth paying monthly instalments. For instance, a BMW 3 series can cost £140 a month less on a four year vehicle leasing deal than to buy a Ford Mondeo using a loan at 9.9pc over the same period. Leasing a vehicle will mean businesses will avoid VAT and receive a 50pc reduction on executive cars that are also used for personal journeys. However, many business owners are unsure of what the benefits of leasing are. However, leasing may not be the answer for everyone. Buying is a better option than leasing if you are planning to own the car for a 10-15 year period; if you’re looking at a 4-5 year stint then leasing is far cheaper. Approximately 2 million cars are sold each year in the UK, with around a million bought by consumers, 800,000 by fleet operators and 200,000 by businesses.