SOME business owners run businesses in which they have to allow their employees to drive cars. Such business owners have the option to either lease or buy the vehicles that they loan to their drivers.

Leasing is different from buying in several ways. First, the person who leases the vehicle does not own the vehicle during the course of the lease. The individual makes a monthly payment for a specified period, and then he or she returns the vehicle at the end of the lease. Consumers do have the option to buy their vehicles at the end of the lease, but they have to come up with a lump sum figure at once. Leasing has many benefits compared to buying, but it also has some disadvantages for businesses.

When the job requires a lot of driving

Vehicle leasing does not make much sense for a business that involves high mileage. The reason is that lease deals have restrictions on the miles that the leased vehicles can go each year. Leasing companies charge business owners additional fees for excessive mileage and wear and tear. Therefore, businesses such as pizza delivery businesses and taxicab businesses would not benefit from driving leased vehicles.

When getting from point A to point B is all that matters

Businesses and individual consumers usually lease vehicles because they can obtain new vehicles every two to three years. However, leasing does not make much sense if prestige is an unimportant part of the business. For example, a plumbing business would not need gleaming new vehicles. The business could make due with older models as long as the workers get to their job destinations.

When the vehicles will be used for personal use

Car leases do not make sense when the employees or the business executives are going to use their vehicles for a great deal of personal use. Tax deductions are available only for businesses that use the vehicles primarily for business operations.

These 3 factors mentioned makes the option of applying a car loan from Clydesdale Bank a better idea than leasing a vehicle would be for some business owners. A finance company can help a business owner locate a fleet of vehicles that the business will own. During the consultation, a specialist can speak with the business owner about the benefits that buying has over leasing.