Business Car Finance
Your business success is our success
Whether you're a sole trader or large company, business vehicle finance with Volkswagen Financial Services is easy. We'll help tailor your vehicle finance to suit your needs so the best business outcome is achieved at a competitive price1.
Flexible business finance options2
Volkswagen Financial Services has a range of tax-effective solutions to help with your business: Chattel Mortgage or Finance Lease. See the below table to see what's included.
Chattel Mortgage | Finance Lease | |
|---|---|---|
Deposit | + | |
Residual or balloon payment at the end of the term | + | + |
Tax-deductible repayments | + | |
Tax-deductible depreciation | + | |
Tax-deductible interest | + | |
GST is payable on the cost of the asset | + | |
GST is payable on the repayments | + |
Deposit
+
Residual or balloon payment at the end of the term
+
Tax-deductible depreciation
+
Tax-deductible interest
+
GST is payable on the cost of the asset
+
The difference between
financing vs leasing for businesses
Financing
Buying a car is a significant expense, and repayments are not usually tax deductible, which can make financing a new vehicle more expensive in the short-term.
However, buying a car has several benefits that leasing doesn’t offer – most obviously being that you ultimately end up owning a long-term asset. And while your loan repayments may not be tax deductible, interest repayments qualify as business expenses.
Additionally, petrol, mileage and maintenance expenses can be written off, and insurance and liability costs are typically cheaper on vehicles owned by your business.
Leasing
Most business owners prefer to lease their vehicles, and it’s easy to see why. Lease repayments are usually less than monthly loan repayments and are tax deductible.
This means that in the short term, leasing a vehicle is a more affordable option, and it gives business owners the freedom to upgrade their vehicle to a newer model at the end of their lease term if they choose.
It is however worth noting that while the monthly payments may be more affordable, they don’t add up to an asset for your business.
It's well worth doing a cost-benefit analysis before you commit either way, taking note of the car’s total cost over the car loan or lease term including:
- Monthly payments, including interest
- Anticipated mileage
- Maintenance, fuel, insurance, parking and other related costs
- The value of the car at the end of the lease vs. the ownership period.
Your benefits
- No annual charges or account keeping fees.
- Option to bundle your registration, Compulsory Third Party insurance (CTP), comprehensive insurance and on-road costs with your monthly payments.
- Monthly repayments reduced by adding a balloon payment at the end of your loan or paying a deposit.
- Flexible payment options that suit your business cash flow: weekly, fortnightly or monthly by direct debit or BPAY.
