Company Car - Buy or lease?

H

hikicker

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I'm gonna get a company car through my company (which I own) and do not wish to go for mileage allowance as I do over 50k per annum.

Which is the better route: contract hire or hire purchase?

can anybody point out the advantages/disadvantages of either option?

Thanks in advance
 
If you are getting it through the company, you are far better off just buying it for cash or else with an ordinary overdraft or loan. Then you can do what you like with the car. You can trade up or down whenever you like. You are not tied into any fixed timeframe.

However, I thought that people had moved completely against buying company cars. It's a while since I have looked at the figures, but it always seemed better to buy it yourself and charge mileage.

The only advantage of a company car is prestige.
 
I've been down the mileage road before and it doesn't add up if doing a lot of travelling. It cost the company a lot of money of which it couldnt reclaim any Vat on fuel and I got into debt to finance the car.

This article backs up my view: [broken link removed]

My original post stated hire purchase however I meant the company getting a bank loan to buy the vehicle. My gut feeling is to buy the car through the company rather than lease but I think there can be more accounting involved for depreciation etc. Any thoughts?
 
I wouldn't have thought that the accounting would be a problem or burden.

It would be hugely outweighed by the flexibility of owning the car and being able to time its disposal without penalty.
 
If the company paid for the car via a non secured loan or cash there would still be the flexibility to trade up in the future. As originally stated I won't be going down the mileage route and simply want to know if it is better to buy or lease from the company's perspective
 
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