Company car finance lease

[ASB]

I don't get this.

It matters not whether you own the vehicle or if someone else does and leases it back to you. You are still going to be the one paying for the depreciation, no-one else is going to pick up the tab.

tim

I think the point mgiht be this:-

If you do few miles the depreciation is proprotianately higher, thus the cost per mile goes up. This is reflected in the lease payments which are a chargeable expense to the company. This therefore comes from pre tax income and there is a point at which it is cheaper to have the car as a company lease and pay the BIK.


But it's still likely to be rare that the company wins out.

[tim123]

My point is, if you're going to do few miles, why have a plan to own a car that depreciates a lot and then get rid of it after 3 years.

If you're doing 4,000 mile pa (which seem to me to be 'few') and your car is costing you 4K in depreciation each year, that's a pound a mile. You might just as well get a taxi/hire car everwhere.

So ISTM that having a car that depreciates at 4K pa, doing 4,000 mile pa and replacing it every three years (with only 12,000 on the clock) is a silly thing to do. One ought to be changing one of the entry conditions, not changing the way that the deal is financed.

tim