Company car: lease or buy?
Posted on 17.11.2017 by
lease a car, private purchase or buy on the matter. What's cheaper? It seems like a nobrainer because the leasing company must also earn. Or is the opposite true?
Leasing companies like LeasePlan offer entrepreneurs and freelancers lease cars at a fixed monthly rate. That fee includes everything (road tax, insurance, repairs, maintenance and tires) and thus ensures worry-free and no surprises or hassle. By unburdening however, incur costs and that cost can naturally be found in the rates you pay. Use your common sense can therefore consider that a lease therefore it should be more expensive than a car that you possess yourself. But nothing further from the truth.
The calculation example
The saying goes, "knowledge is power". The calculation example is based on a five-door Volkswagen Polo 1.4 TDi BlueMotion. The annual mileage is 25,000, of which 17,000 kilometers business. In the table below you can see that in this case leasing is cheaper, the whole calculation you can find (PDF) here.
|Privately owned self-employed||€ 480|
|Business ownership self-employed||€ 450||€ 30|
|Lease self-employed||€ 440||€ 40|
How a leasing company can be cheaper?
Roughly speaking, there are four reasons why leasing a car is in many cases cheaper:
- low interest costs
- less administration
- No risk of residual value and maintenance
low interest costs
Even if the money private or business is in stock, you may wonder whether it is wise to lock your money in one or more cars. The hold reserves to maintain for unforeseen expenses or periods that a command is not immediately available, factually much wiser.
If the money for a new car to be borrowed, then the calculation is often even easier. The interest rates for short-term loans are high and the interest LeasePlan offers is very sharp.
If you have negotiated a discount from the dealer, LeasePlan takes over. Thanks to its purchasing power can sometimes even more discounts are granted and that you can look back in the tariff.
In a car, all invoices are entered and sometimes complex tax calculations. The leasing company sends a single monthly bill collecting and the processing thereof, it is, of course, a lot easier.
No risk of residual value and maintenance
If you lease, the risk on residual value loss and maintenance supported by LeasePlan. Thanks to the experience of managing a large fleet, LeasePlan can judge better what the residual value will be and what are the expected maintenance costs.
Bonus: the leasing company takes care
If everything runs smoothly, managing a fleet need not be a burden. It is different if there are things happening. In a collision at home or abroad often look very much: insurance, repair, towing and car replacement. These are things that the specialist does much faster and more convenient.
As a fleet manager you will sometimes make arrangements for private use, and maintenance tank passes. Instead of the wheel to find out, LeasePlan can provide you with a standard rider regulations.