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Vehicle leasing is becoming more popular for SMEs

SMEs have found vehicle leasing the way forward since the VAT rise in January 2011. The increase saw VAT jump from 17.5% to 20%, impacting on company’s working capital. Recent surveys have also shown that over 35% of Europe’s SMEs use asset finance.

2011 also saw SMEs realise the potential of leasing with the help of lower VAT bills. SMEs also showed their interest in vendor finance, which increases sales through their own money and not exploit the more conventional methods i.e. bank loans, thus helping to avoid needed collateral, which therefore avoids interest rates.

Vehicle leasing has also benefited from capital allowances, as they were linked to the car’s CO2 emissions. A leased vehicle emitting 160 CO2 or below is 100% allowable and above 160 CO2 is up to 85% allowable. If you are VAT registered then dependent on usage you can recover at least 50% of the VAT and in some cases 100%.

Check out to Buy - to Lease

Use the table to compare the different features and benefits to our vehicle funding solutions.

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Posted on 13th February 2012 at 5:20 PM

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