Dawsongroup | finance

Cost-Effective Benefits of Business Van Leasing

Business vehicle leasing is a way of purchasing a new fleet of commercial vehicles by paying small monthly instalments over the curse of a few years, rather than buying the fleet in one sum. After the contract period of a few years is over, you hand the vehicle back and get a new one. If this is the first time you’ve heard about leasing, here are some of the cost-effective benefits of business van leasing.

Better Cash Flow

There’s a reason why car manufacturers are making new cars – they’re just better and people want to drive better vehicles.

A brand-new van will cost at least £25,000 which is a big number for most businesses, especially as an upfront payment. The ability to pay in small monthly sums is one of the cost-effective benefits of business van leasing. You can then spend the money you have saved from a lease package on other areas of the business.

Tax Benefits

One cost-effective benefit of business van leasing is the money you, as a business, can save on tax. VAT registered businesses can claim back 100% of the VAT on the lease vehicle, provided it is only used for business use and never used as a personal vehicle.

As a limited company, you can offset the monthly rental against your corporation tax, or if you are a sole trader, you can offset the rental against your yearly taxation. If your leased van emits more than 160g/km of CO2 then you can claim 85% back and anything less than this, then you can claim 100% back.

Avoid Depreciation

We could all benefit from a new fleet of vans. Unfortunately, as soon as you buy a brand-new van and drive it out of the showroom the value will drop. This is why leasing is cost-effective as you avoid these depreciation cost. Instead, you lease the van for a contracted period of time and when that time is up, you can trade it in and get a brand-new van instead.

We can sort cost-effective business van lease deals, from the lease of one van to a whole fleet of vans. Find out how we can help you by emailing info@dgfinance.co.uk, calling 01425 474070, or using our contact form. One of our friendly team members can discuss your options and find a cost-effective lease deal for you.