A company car: yes or no?
Many people consider a company car. But it is important to check whether it is wise to purchase a car for business or private purposes. In this article more information and tips about leasing and insurance. Futher reading at http://www.cincy-racing.com/best-payday-loan-consolidation-a-payday-loan-consolidation-program-in-minutes/
Is a company car a good move financially?
It is important to consider whether you purchase a car for business or private. And of course whether you subsequently include your car in the assets (which means that it is deductible from the profit). For a company car, however, you have to take into account that you will receive a private addition, based on the catalog value of the car that can be as high as 25%. This only applies if you drive more than 500 kilometers per year for private purposes, but you must be able to prove this.
Is buying a car a good idea?
Buying a (new) car is of course not a wise move if you don’t have the means. A loan is then necessary, which costs a lot of money. See if a second-hand car is an option, so an expensive loan is often not necessary. Negotiating is also important if you buy new, who knows you might get some benefit from it.
How many kilometers do you have to pay for a company car?
If you have purchased a car for private use and also drive there for business, you can charge € 0.19 per business-driven kilometer tax-free to your company. So if you drive a lot for business, a private car is in many cases more interesting.
Rent a company car or lease a car?
Of course, leasing is also an option if you don’t have the money immediately available. With a fixed monthly amount you are assured of a trouble-free car and your maintenance and insurance are included. Keep in mind that you cannot profit from the residual value and that leasing is relatively expensive, but easy. Of course you also have the choice here whether you are business or private.
Insure company car
Insurance is necessary to prevent financial setbacks. With leasing all premiums are paid, but you can of course also arrange this yourself. Inform well with different insurance companies how much you pay in premium, what damage is reimbursed, whether there is a deductible and pay attention to small print!
In short, it is important to consider what is necessary for you: do you really need an expensive lease car, or is private driving and declaring your business mileage actually cheaper? Make a comprehensive comparison between the different options and see what is affordable for you now, but also beneficial in the long term.
Have you ever considered a company car?