If you’re running a small, rapidly growing business, you have a lot to handle. Mobility shouldn’t be one of them. Customers need their goods and services on time, and delays can negatively affect your business. Instead of looking at car finance options, consider leasing. Leasing isn’t just for large companies running big vehicle fleets. Any business, big or small, can benefit from leasing. Around one out of four vehicles in the United States is leased. Here is the benefits leasing offers your business.
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Improved Cash Flow
Buying a car can negatively affect your cash flow. It will stand out as a liability on the balance sheet and prevent you from securing more lines of credit if needed. But you need far less money to lease a car and you can pay a fixed amount for a pre-agreed period of time.
Good cash flow translates to a healthier balance sheet. You won’t spend thousands of dollars paying for a car that will depreciate a few years down the line. You can use the money you would’ve spent buying the car to grow your business.
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You Don’t Waste Money on a Depreciating Vehicle
Finding the right car to buy for your business is difficult enough, let alone setting a budget for it. And since the vehicle’s value will only go down, you’ll never get the amount you paid for it when you want to sell it.
But leasing is easy. You can determine how much you’ll pay for the car long before you lease it by using a lease calculator. And once the contract is over, you can order a new lease car or simply walk away. You won’t have to worry about selling the car and recouping your money. There’s no risk of negative equity. To learn more about car depreciation, read this guide.
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You Can Reclaim Costs
When you lease a car for your business, you can deduct the monthly lease payments on your federal tax returns. How much you’ll be able to claim will depend on how much you use the car exclusively for business. If your monthly payment is $500 and you use the vehicle 60% of the time for business, you can reclaim $300 per month.
But it’s worth noting that you can only deduct monthly payments as expenses if you sign a standard lease, not a lease-to-own contract.
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You Can Lease an Eco-friendly Vehicle
Because it’s more affordable to lease a car, you can easily afford one with the latest fuel economy. This is a great way to help both humans and the environment. An eco-friendly vehicle releases fewer harmful chemicals into the air because it emits low-carbon compounds when running
An energy-efficient, eco-friendly vehicle will save you a significant amount of money because it uses less fuel to run. The U.S. government offers tax deductions for eco-friendly cars to encourage more people to use environmentally sustainable vehicles. For taxpayers, this usually translates to tax refunds and lower income taxes.