Van leasing is generally refereed to as a "Finance Lease"
This guide explains the main points of leasing
It is a method normally for companies that allows lower than normal monthly payments.
- Small deposits. VAT does not hav have to be paid for upfront. Deposits range from just a few hundred pounds to most of the vehicle.
- All deposits count as advance rental in the eyes of the TAX office and are 100% tax allowable as an expense
- Generally the Govrment favours leasing for small business since all subsequent rentals are also 100% TAX efficient
- Manufacturers favour Van leasing and the discounts are often greater to the customer as it protects the future second hand value.
- At the end of the agreement it is time to sell the vehicle. There is usually a final payment at the end which is generally oly a small proportion of the vehicles value.
- The customer gets to keep 95-98 % of any disposal profit.
- The vehicle can be sold to whomever the customer pleases, but no further TAX relief may be claimed as 100% has already been given. Time to sell it really.
- No inspection is done at the end for damage
- No milage limits
- If the vehicle is to do a super high milage, or you expect to damage the vehicle, you may want to consider paying more per month and reducing the final payment so there is not a shortfall. e.g a courier doing 1500 miles per week it is unlikely that the vehicle will be worth much after 4yrs.