Your business needs to get moving, yet the cost and upkeep of a new van is out of reach. We explain why van leasing may become your new best friend. 

AVOIDS LARGE INITIAL PAYMENT, ENSURES PEACE OF MIND 

Whether a start-up or established, no business likes to take a financial hit, leaving its cash flow a little squeaky. Van leasing agreements can include maintenance,  breakdown cover and a full manufacturer’s warranty for the lifetime of your lease agreement; not only an organized approach to running your business but an end to sky-high garage bills landing on your office doormat. Also, as leased vans are not counted as assets, this reliable and cost-effective method of financing ensures that your balance sheet is not immediately in the red when taking delivery of your new vehicle.

TAX SAVINGS

UK van leasing is the equivalent of rental, and the rental payments are treated as a tax-deductible expense in the profit and loss account of your business. The VAT portion of the payments is also reclaimable when charged, thus maximizing your tax efficiency.

PLEASE RE-LEASE ME

When you purchase a van, it depreciates as soon you drive down the road. You lose. Likewise, when you come to sell your trusty workhorse, you may have to accept a reduced price, if your negotiating skills are a little rusty. You lose again. However, leasing a van ensures that you can drive away from the broker, without its residual value leaking out of the exhaust. Additionally, the stress of selling is removed; your broker will set a final balloon payment, based on a resale value set at the start of the lease and you can use this amount as a down payment for your next leased van. You know where your finances are, right from the start. If that is not a win-win-win outcome, we don’t know what is!

SAFETY IN NUMBERS 

I just paid for my van upfront, so I’ll save more money than you and your leased van.’

Hmmm, don’t be too sure, too soon! If your colleague stays lucky over the entire course of his van’s lifetime, if his business flourishes, maybe so; however, there is still that nasty depreciation for him to worry about. Not ideal when he will need a good sale price to finance his next van. Let’s hope his negotiating skills are not rusty! However, the unpredictability of his business is, literally, not your problem. You have the security of your lease agreement, no ifs, no buts. It might be a good time to remind him that Personal Contract Hire lease monthly repayments are often lower than a personal van loan. 

LAST YEAR’S MODEL 

With UK lease agreements between 1-5 years in length, there is no need to worry about your business being at risk, as your van coughs and wheezes into its final days. With maintenance, repair and servicing included, you can maximize its lifetime, before choosing to either hand the keys back at the end of the agreement, or to use the pre-arranged resale value as a deposit on a brand-new leased van.

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