Whether your business needs a fleet of vehicles or just a single one, there are a lot of benefits to leasing a vehicle through an operating lease, many of which can mean time and money savings.
The following list is just some of the ways that utilising an operating lease is a good way to save time and money.
No up front cash layout
An operating lease is akin to a long term rental – with this in mind, the first financial benefit is that there is no upfront cash amount required either to purchase the vehicle or for a deposit.
Vehicle maintenance, costs and modifications simplified
If you have a fleet of vehicles to maintain, this can be a full time job in itself. An operating lease allows you to have much of this work managed for you.
There are options to have varying levels of maintenance and servicing included with an operating lease, obviously the higher level of maintenance you leave to the leasing company, the more time you can save not having to manage this aspect on your own.
If you require any modifications to be made to the vehicle to allow for a disability or wheelchair access, these can be arranged as part of the service too so you don’t have to spend the time finding the best provider to carry out the work.
With an operating lease, you can consolidate many running costs such as registration, tyres, fuel cards and insurance into one single monthly payment. Having a single monthly payment for all of the costs associated with running a vehicle can be great for cash flow, as you know the costs you are looking at in advance and can budget for them.
The single payment also means less of a bookkeeping or accounting burden, as you don’t need to manage numerous payments to different providers.
Tax advantages
There are also tax benefits associated with an operating lease that can offer financial savings to you as opposed to other options for financing vehicles.
With an operating lease, the payments you make are tax deductible for the portion that the vehicle is used for business purposes. As an example, if the vehicle is used 80% for business, then 80% of the payment is tax deductible.
Additionally, because the total cost of the lease is paid over a set term, at the end of your lease you return the vehicle with no lump sum payment required. This means there is no residual value or FBT liability for your business.
As with any financial business decision, talk to a professional to discuss if an Operating Lease is the best option for your business. The team at Street Fleet can help you with all your car finance needs.