We’re always surprised just how many businesses don’t have the right fleet finance package. Of course, we’re very much pro-leasing – not least because we can see all the benefits for company car tax, insurance, fuel costs and more. So much so that we’ve got a presentation about it, which you can download at the bottom of the page.
We’ve picked out the big eight factors you should consider when you’re looking at your fleet finance:
Depreciation
The average car loses 60 per cent of its value in its first three years, based on the car being in good condition and covering 10,000 miles per year[1]. So if you buy a £30,000 car now, you’ll have lost £18,000 in three years’ time. How does that value compare to the cost of leasing and company car tax?
Insurance
If your employees are using their car for business, how are they insured? Have they got the right cover? Whose unenviable driving history is pushing up your company premium?
Fuel
How’re your drivers buying their fuel? And are your employees driving the most efficient cars?
VAT
Most fleets can reclaim up to have the VAT on a car lease. If the company buys the car, though? Probably not[2].
Service, maintenance and repair
Who coordinates the servicing, maintenance and repair of your company’s vehicles? What if there’s a fault that causes an accident – are you liable?
Employee benefits
How do you make a company car scheme cost-neutral? You need to look at the cost to the business, and company car tax versus other costs for employees.
Corporation tax
Businesses can claim capital allowances on cars bought and used for business. How does this compare to the cost of leasing and being able to reclaim VAT?
Mileage
Company car mileage can have a huge impact on your decision and expenditure – especially your fuel costs and, if buying, the residual value of your vehicles, as well as insurance.
Many deals are struck with only limited understanding of these forces. Take a look at our short slideshare and find out if you’re on the right finance package. And for more information and advice, call our experts on 01753 802448.
Source:
[1] http://www.theaa.com/car-buying/depreciation
[2] https://www.gov.uk/reclaim-vat/cars
Updated : 20.8.18
