Van lease versus cash purchase

Citroen Nemo 1.3 HDi Enterprise [non Start/Stop] diesel Van (New Van - built to order)

=====

Cash purchase £8,252 + VAT, £9,902 inc VAT

Reference:
http://tinyurl.com/pfrp7cm from
http://www.buyacar.co.uk/citroen_nem...F8CD7701B1CC26

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48 month Lease, then purchase:
Initial rental - £456 + VAT, £547.20 inc
47 x £152 payments - £7,144 + VAT, £8,572.8 inc
Final rental - £2780 + VAT, £3,336 inc
Total £10,389 + VAT, £12,456 inc

Reference:
http://tinyurl.com/pfsu23u
http://www.rivervaleleasing.co.uk/va...tartstop-24215

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Santander offer 3% gross on balances up to £20,000, and this is about the best rate available. 3% gross PA of £9,902 compounded over 4 years is £1,243, but that doesn't account for the initial 3 months rental and the 47 monthly rental costs. Taking this into account, the 3% PA interest compounded over 4 years comes to £647, less tax = £539.

Conclusion:
A 48 month lease followed by a purchase of a Citroen Nemo van is £2,015 or 20.3% more expensive than a straightforward cash purchase.

There may be some moderate tax advantages of leasing over buying, but there is no way this could or would amount to 20.3%. The advantages to operators of a fleet by outsourcing most of the fleet operation costs does not apply to a sole trader.

Tom Crispin put finger to keyboard:

snip

Isn't it about time you stopped banging this particular drum?

Leasing medium-value commercial goods is a normal and common business
practice, for small companies/one man bands as well as large corporates.

On Fri, 18 Dec 2015 04:35:15 -0800 (PST), Tom Crispin wrote:

Citroen Nemo 1.3 HDi Enterprise [non Start/Stop] diesel Van (New Van - built to order)

=====

Cash purchase £8,252 + VAT, £9,902 inc VAT

Reference:
http://tinyurl.com/pfrp7cm from
http://www.buyacar.co.uk/citroen_nem...F8CD7701B1CC26

=====

48 month Lease, then purchase:
Initial rental - £456 + VAT, £547.20 inc
47 x £152 payments - £7,144 + VAT, £8,572.8 inc
Final rental - £2780 + VAT, £3,336 inc
Total £10,389 + VAT, £12,456 inc

Reference:
http://tinyurl.com/pfsu23u
http://www.rivervaleleasing.co.uk/va...tartstop-24215

=====

Santander offer 3% gross on balances up to £20,000, and this is about the best rate available. 3% gross PA of £9,902 compounded over 4 years is £1,243, but that doesn't account for the initial 3 months rental and the 47 monthly rental costs. Taking this into account, the 3% PA interest compounded over 4 years comes to £647, less tax = £539.

Conclusion:
A 48 month lease followed by a purchase of a Citroen Nemo van is £2,015 or 20.3% more expensive than a straightforward cash purchase.

There may be some moderate tax advantages of leasing over buying, but there is no way this could or would amount to 20.3%. The advantages to operators of a fleet by outsourcing most of the fleet operation costs does not apply to a sole trader.



I think you may be mentally ill.

You need to get a life.

On Fri, 18 Dec 2015 13:41:08 -0000 (UTC), Scion wrote:

Tom Crispin put finger to keyboard:

snip

Isn't it about time you stopped banging this particular drum?

Leasing medium-value commercial goods is a normal and common business
practice, for small companies/one man bands as well as large corporates.


I think he is trying to demonstrate what a truly sad person he is.

He is certainly succeeding.

On Saturday, December 19, 2015 at 10:59:48 AM UTC, Judith wrote:
On Fri, 18 Dec 2015 13:41:08 -0000 (UTC), Scion wrote:

Tom Crispin put finger to keyboard:

snip

Isn't it about time you stopped banging this particular drum?

Leasing medium-value commercial goods is a normal and common business
practice, for small companies/one man bands as well as large corporates.


I think he is trying to demonstrate what a truly sad person he is.

He is certainly succeeding.

I am actually trying to help Plankwit understand basics.

He has previously told us that he pays hardly any income tax at all. This suggests that his taxable income is just a little over £10,600 per annum. On that sort of income, he is unlikely to be able to afford to buy a brand new van (unless he raised a substantial sum by downsizing his family home). Being unable to afford a brand new van, I can see that obtaining one through a leasing agreement might appear both affordable and attractive: it is not. It is an even more expensive option.

We know that Plankwit is a hopeless failure when it comes to mathematics. To compensate for his numerical inadequacies, and by his own boast, he hires a top accountant to advise him (which again costs him dear). He claims that the accountant advised him to lease the van, but he lacks the numerical skills to check that the accountant's advice is sound. It is therefore, from a sense of moral duty, that I offer my free advice to him, and let him know that he has made another financial blunder by leasing his van.

On Saturday, December 19, 2015 at 10:59:48 AM UTC, Judith wrote:

I think he is trying to demonstrate what a truly sad person he is.

I'm doing nothing of the sort, though Plankwit may well be a "truly sad person". I am trying to help Plankwit in financial matters.

He is certainly succeeding.

On Sat, 19 Dec 2015 14:46:29 -0000, Tom Crispin wrote:

[]
is sound. It is therefore, from a sense of moral duty, that I offer my
free advice to him, and let him know that he has made another financial
blunder by leasing his van.

Please do so elsewhere, this is tedious, and not even vaguely
cycle-related.


--
Bah, and indeed, Humbug

On Sat, 19 Dec 2015 10:58:20 +0000
Judith wrote:

I think you may be mentally ill.

You need to get a life.

That's so funny I thought it must have been the impersonator troll.

On 19/12/2015 14:46, Tom Crispin wrote:
On Saturday, December 19, 2015 at 10:59:48 AM UTC, Judith wrote:
On Fri, 18 Dec 2015 13:41:08 -0000 (UTC), Scion wrote:

Tom Crispin put finger to keyboard:

snip

Isn't it about time you stopped banging this particular drum?

Leasing medium-value commercial goods is a normal and common business
practice, for small companies/one man bands as well as large corporates.


I think he is trying to demonstrate what a truly sad person he is.

He is certainly succeeding.

I am actually trying to help Plankwit understand basics.

He has previously told us that he pays hardly any income tax at all. This suggests that his taxable income is just a little over £10,600 per annum.

After allowable expenses.

You know... the "losses" side of the P&L account.

It includes things like vehicle leasing charges.

100%. No quibbling, no argument, no doubts.

On that sort of income, he is unlikely to be able to afford to buy a brand new van (unless he raised a substantial sum by downsizing his family home).

What?

The cost of buying a van is a business expense.

If he bought a new van, the interest repayments would be a business
expense. But that would not necessarily apply in full to repayment of
the principal sum.

But when he leases a new van, all of each of the payments made to the
lessor are a business expense.

Part of the payment does not become a notional "profit" which falls to
be taxed.

Being unable to afford a brand new van, I can see that obtaining one through a leasing agreement might appear both affordable and attractive: it is not. It is an even more expensive option.
We know that Plankwit is a hopeless failure when it comes to mathematics. To compensate for his numerical inadequacies, and by his own boast, he hires a top accountant to advise him (which again costs him dear). He claims that the accountant advised him to lease the van, but he lacks the numerical skills to check that the accountant's advice is sound. It is therefore, from a sense of moral duty, that I offer my free advice to him, and let him know that he has made another financial blunder by leasing his van.

On Sat, 19 Dec 2015 06:46:29 -0800 (PST), Tom Crispin wrote:

snip



As I said: you are a very, very sad person . You need to get a life.