Business car leasing is an increasingly popular method of financing a new vehicle for business use. There are several reasons for this, but the main one is it can be a far more cost-effective way of having company cars for your business.
If you’re considering leasing a car or multiple vehicles for your business, we’ve put together everything you need to know in one place. Our guide covers the benefits of a business car lease, how the process works and what you need to lease a car for business.
You’ve got a lot to think about when running a business — from the products or services you offer to the premises you operate from. And, of course, you'll need to think about how you and your team will get around.
Having a reliable mode of transport is essential for any business, and leasing a car can be a great way to ensure you're never without a set of wheels. Of course, there are other ways to get a company car, but a business car lease has some distinct benefits:
However, it's important to remember that leases typically come with mileage restrictions, so businesses should only consider leasing if they are confident they can stay within those limits.
Find out more about the benefits of business car leasing.
Business leasing is an excellent way to get a new car without paying the total purchase price upfront. Essentially, your business pays a monthly fee to lease the vehicle from the leasing company for a set period, usually two to four years.
At the end of the lease, you simply return the car to the leasing company and start again with a new lease if you wish.
Read our step-by-step guide to business car leasing.
Just as there are requirements for a personal car lease, you’ll need to meet specific criteria to qualify for a business lease. These requirements are relatively straightforward, and most businesses will qualify.
Firstly, you’ll need to be one of the following:
If you’re one of the above, you’ll be eligible for a business car lease. In the next step, you’ll be required to provide the following information:
Once you’ve provided this information, your company will be expected to pass a credit check before you can move forward with your business lease(s).
One of the most significant benefits of leasing a car for your business is that you can claim your lease payments as a business expense. If you use your vehicle for business purposes, you may be able to deduct the cost of your lease payments on your taxes.
To qualify, you must use the vehicle for more than 50% for business purposes. This includes travelling to meetings, carrying supplies or visiting clients.
If you also use your car for personal reasons, you can only deduct the portion of your lease payments related to business use. For example, if you use your car 60% for business and 40% for personal use, you can only deduct 60% of your lease payments on your taxes. If you're unsure whether your usage qualifies, talk to your accountant or tax advisor.
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