Ways in which Business Car Leasing can help a Company
Posted by Shrikant Sharma on February 25th, 2020
Business owners stand to gain a lot when they opt for business car leasing. Buying a car for a business means a hefty cost has to be incurred, first with the down payment for the vehicle, and then with the subsequent EMIs. Even if the value of the car drops, this loan amount still has to be paid with no changes and this frequently happens in the event of a car crash which leaves the vehicle in poorer condition than it was before. With business vehicle leasing, a company stands a chance to enjoy a number of benefits instead:
Tax Relief: Tax deductions are always important, especially for a new company. In most cases, the leasing amount can be deducted after one shows adequate documentation that 50% of the time for which the vehicle is driven is used for work related service. In case of car ownership, only the interest on the car loan can be deducted.
Steady access to great performing cars: It is not so easy to buy or sell one’s own car on a frequent basis, and this has long term affects on the running of the business. An old car will frequently slow down or even break down. With car loans, one will not be able to sell the car easily if the EMIs are not over. With leased cars, one can simply switch to a new model when the old one gets outdated and one can upgrade to vehicles which are better fitted with technology. This is essential for the safety of the business and the cargo, and an added plus is the better image the company portrays.
Easier to get Approval: Applying for a vehicle loan can lead to a ton of paperwork and even then the bank might reject the loan application at the end of it, on some flimsy grounds. This is waste of time which a running business cannot afford. Business car leasing, on the other hand, get approved in a matter of 24 hours or so, and one can start driving the car immediately.
Lower Payments: For start ups, every penny is crucial and savings are an absolute must. The EMIs on car loans can drain the company, especially during slow seasons. On the other hand, the payment for car leases is far lower than what one pays for a car loan. The money saved can be utilized to look into other operational costs of the business. At the end of the lease, if you happen to like the car very much, it can be bought from the leasing company as well, depending on the lease one had agreed on.
No Hassle of Selling: Selling an outdated or old car is often difficult because most buyers do not want to put up with the depreciation costs of a second hand car. With car leasing, there is no need to waste time looking for buyers or worrying about a good deal. The car can simply be handed back to the business vehicle leasing company once the lease period is over and the purpose is served.
About the AuthorShrikant Sharma
Joined: February 19th, 2018
Articles Posted: 145
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