Business car leasing explained

Business car leasing explained

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The financial benefits of business car leasing are a part of what makes the option so popular with businesses of all types, from large corporate enterprises to smaller organisations. These financial benefits include tax savings, as all leased vehicles should be fully taxed throughout the length of your contract. Car leasing deals can also include savings such as 100% reclaimable VAT on maintenance and 50% VAT reclaimable on finance.

Finance options for business car leases are diverse. You might find that your organisation is better suited to finance leasing, through which you pay off the full cost of the car in monthly instalments over an agreed period of time. This option does include interest on the funding of the vehicle, but may make your payments more manageable in the long run. You could also opt for -balloon payments’; regular monthly payments plus a larger final payment that is decided upon in an initial contract between you and your business car leasing company.

Car finance leasing is often a more suitable option for large scale leases simply due to the cost of hiring a multitude of vehicles. But leasing a significant number of cars may also have a wider impact on your business through the management of your fleet.

For some companies, in-house fleet management is more than enough to keep updated on the condition and replenishment of business car stock. However, if the scale of the task is overwhelming for your staff or if hiring someone for the sole purpose of managing your fleet does not make good business sense for you, then fleet management can be an easy and effective alternative. Many business car leasing companies will offer a fleet management service which involves someone from their own staff keeping a track of your orders and repairs to ensure that you are never caught short.

In the event that someone breaks down on the way to a meeting, a fleet manager should have a system in place to handle the situation and ensure either the replacement or repair of the vehicle as well as maintenance to prevent the worst from happening. Maintenance packages tend to be agreed at the start of a contract and can include routine servicing as well as breakdown repairs and replacement tyres or batteries. It’s worth shopping around to be sure that you have the most appropriate support package depending upon the needs of your organisation.

The business car leasing options available on the market are endless. Before deciding to spend your organisation’s budget on a fleet, consider the options above and how much of the responsibility you would want to outsource or maintain in-house. As well as being cost-effective and easy to manage, is flexible and can be tailored to your individual needs.

Clint Starr writes for a digital marketing agency. This article has been commissioned by a client of said agency. This article is not designed to promote, but should be considered professional content.

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