Buy, Lease or Finance a Company Car?
Most often billed as a perk when accepting a new job offer, a company car is seen by many as a luxury that makes your workday easier. The UK government heavily subsidises the company car market making it easier for businesses to access vehicles for their employees.
However, it can be a minefield when deciding which route to go down when acquiring a new company car. There are many options when it comes to purchasing a vehicle. Here we break down the three most common options.
Pay upfront and buy your company car
Take the most transparent and straight forward route to buying a company car and pay up front for the vehicle you will be using for work. Owning the car is a much simpler option. If you pay for the car in full in cash, you can reduce monthly overheads for your company. Buying a second-hand car would reduce the overall price of the vehicle too.
If you do opt for a second-hand company car, make sure you choose a reputable car dealer like Fords of Winsford. They have a large selection of pre-loved cars and are always on hand to help you find your ideal model.
Spread the cost with a finance plan
Your business may prefer to budget monthly costs and avoid paying out huge lump sums. Agree a monthly budget with your employer and pay via a finance plan for the company car. It will help your business budget on a month-to-month basis without any spikes in spending to report.
One drawback to a finance plan, however, is the interest rate that usually applies. Rates vary depending on the term length and finance company used but all finance plans will occur an additional cost for the car in the long run. It is worth weighing up all the details of a car finance plan before committing to a monthly cost.
Upgrade your vehicle and lease the latest model
Impress your clients with a more expensive model by leasing a car. You can rent a top-of-the-range car for a single trip or lease over a period of a few years from a dealer. Leasing is a great option for companies who have a lot of customer-facing work to do. A better car will make a more significant impression on new and existing clients.
However, leasing for an extended period can be a drain on finances for many companies. Without an owned asset for the business at the end of the lease period, it could affect your company’s profit and loss. It is important to decide how much revenue driving an expensive looking car will bring in for your business before leasing one.