If you’re thinking about upgrading your vehicle, you might assume you’ll need to buy it personally. But if you’re a company director, there’s another option worth considering.
Financing a vehicle through your business can be a smart way to spread the cost, preserve cash flow and drive a vehicle that suits both your role and your company. Whether it’s an electric vehicle, a high-performance SUV or something you’ve always dreamt of owning, company car finance gives you access to the vehicle you need without the significant upfront investment.
What is a company car?
A company car is a vehicle that’s owned or financed by a business and provided to a director or employee. It can be used for business travel and depending on the arrangement, personal journeys too.
For directors, a company car isn’t just about getting from A to B. It can be a practical business asset, a reflection of your brand and a convenient way to access a newer vehicle while keeping your personal and business finances seperate.
The key is choosing the right finance option and ensuring the vehicle works for your business as well as your day-to-day needs./he
Why do directors choose company car finance?
Buying a vehicle outright isn’t always the best use of your business’s money, especially when that cash could be invested elsewhere.
Protect Your Cash Flow
One of the biggest advantages of finance is that it allows you to spread the cost over manageable monthly payments instead of paying a large lump upfront. That means more cash remains in your business to support growth, whether that’s hiring new staff, investing in equipment or simply maintaining healthy working capital.
Tax Benefits
Depending on the vehicle you choose and how it’s used, financing a company car through your business may offer tax advantages.
For example, fully electric vehicles currently benefit from lower Benefit-in-Kind (BIK) tax rates than many petrol or diesel models, making them an attractive option for directors.
Tax treatment varies depending on your business and personal circumstances, so it’s always worth speaking to your accountant and our team before making a decision.
Drive the Vehicle You Really Want
Need something that reflects your business? Finance can make premium vehicles much more accessible.
Whether you’re looking for a Range Rover, Tesla, a BMW or a practical commercial vehicle, finance allows you to access higher-value vehicles without tying up large amounts of capital.
Present a Professional Image
For many director’s their vehicle is often the first impression they make
Arriving at client meetings or networking events in a reliable, well-presented vehicle can reinforce your company’s professionalism and give you confidence wherever business takes you.
Upgrade More Regularly
Rather than keeping the same vehicle for years, finance can make it easier to upgrade every few years, allowing you to benefit from the latest technology, improved efficiency and enhanced safety features.
What company car finance options are available?
Every business is different, which is why there isn’t a one-size-fits-all solution. The right option depends on whether you want to own the vehicle, how long you plan to keep it and how you use it.
Hire Purchase
Hire purchase is one of the most common options for directors who ultimately want to own their vehicle.
You’ll pay a deposit (if required), followed by fixed monthly payments over an agreed term. Once the agreement has been completed, ownership transfers to your business.
Finance Lease
Finance lease gives your business use of the vehicle without purchasing it outright.
You’ll make fixed monthly payments over an agreed period of time, making it a flexible solution for businesses looking to preserve cash whilst accessing newer vehicles.
Vehicle Refinance
Already own your vehicle? Vehicle refinance allows you to release equity tied up in it without selling it.
It’s a simple way to unlock working capital, improve cash flow or fund future growth, while continuing to use the vehicle as normal.
Balloon Refinance
If you have a car finance agreement with a balloon payment, you are able to refinance that final balloon payment and spread it over more affordable monthly payments.
Can company directors get vehicle finance?
In many cases, yes.
Whether you’re an established business or a growing company, there are finance options available across a wide range of industries.
When assessing an application, lenders will typically consider:
- Your business’s trading history
- Company financial performance
- Credit profile
- The type and value of the vehicle
- Your overall finance requirement
Every lender has different criteria, which is why working with an experienced broker can make all the difference.
How Moorgate Finance Can Help
Whether you’re buying your first company car or replacing an existing vehicle, our team is here to help.
From executive cars and luxury SUVs to electric vehicles, vans and entire company fleets, we’ll help you find a finance solution that’s tailored to your business.
Thinking about your next company car? Speak to Moorgate Finance today and discover how the right finance could get you the company car you need.
Contact our team today on 01908 92 62 62 or apply now to discuss how we can help you find the right finance solution for your vineyard.
