To lease or buy a company car

If you’re thinking about getting a new company car, you should first consider what you will be using it for and who will be driving it. It may be that it is a better financial decision to lease or buy, depending on what kind of journeys the car will be used for.
Purchase
Obviously, the main advantage of buying a car is that the vehicle belongs to your business after payment.  You will be free to sell it in the future, and some businesses offer their employees the right to buy company cars after a set period of time at a reduced price.
However, purchase can put a big dent in business cash flow, whether you pay for it in monthly periods or in a lump sum, especially if you buy more than one vehicle.
You’ll also have to set aside money for insurance and maintenance. Make sure you compare all the different new car offers that are available before deciding which make and model you buy.
Leasing
The main advantage in leasing a car is the reduction in payments compared with buying a car.  You can often roll maintenance and insurance costs in as optional extras, and these will be cheaper than if you were organising this for a car that you own.
The disadvantage is that you never actually get to own the car, but then you can upgrade more often at the end of each contract, meaning that your business vehicle is always up to date.
It’s worth considering tax implications of company vehicles.  If the car that you choose is one of the low emission cars that are now available, you will pay less tax.
Many leasing companies now offer hybrid vehicles as well as conventional cars, and these can save your business money in terms of reduced running costs.  A hybrid burns far less fuel as it has an electric motor that provides power to assist the engine through acceleration. Of course, you can always buy a hybrid for your business, and gain the same savings in running costs.