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Tesla Model Y - PCP or HP for company car
- Thread starter mjjiva
- Start date
Andy_RS2113
Member
If your company is VAT registered, business lease is the absolute best way to do it. You can offset the monthly payments, insurance, and all maintenance items against the CT liability each year, and you can reclaim half the VAT on the lease payments each quarter. Absolute no brainier for me…
PCP and HP are both forms of purchase, which involve 100% FYA on the purchase price, and expensed running costs.
The other way is contract hire or leasing, which involves all costs as expenses and no capital allowances.
Lease for me.
I did FAR too much analysis on this and there are also far too many ways to slice the pie.
Bottom line, being able to write off payments and 50% of VAT was a no brainer. The only thing that is remaining is being comfortable with the monthly payments.
This is totally different to buying with cash. Ive changed my mindset here as I bought a model S with cash through a ltd company in 2015 but you should realise unless you hoard cash, there are far more effective things you can do with that cash that will produce much better returns, making leasing even more attractive.
Even if you do nothing with the 56k a MY costs, you save about £1,560 on a 56k model Y over 3 years.
It depends on the leasing deal, but going into 4 year leases gets far more expensive, I found comparing multiple leasing deals from various companies the sweet spot for us is 3 years. 4 years they start to gain big.
If you remove CT write downs and VAT refunds and do this privately, its a different story, cash is cheapest but you need to keep it 7 years at least.
There is no doubt that the cheapest years of ownership at 4 to 7+ and that makes total sense as a cash buyer, but in a company, the state of a companies finances and growth could be vastly differently by year 7, of which some of that 56k could have sparked it.
You can easily overthink this, just focus on wether you are comfortable with the monthly payments.
I did FAR too much analysis on this and there are also far too many ways to slice the pie.
Bottom line, being able to write off payments and 50% of VAT was a no brainer. The only thing that is remaining is being comfortable with the monthly payments.
This is totally different to buying with cash. Ive changed my mindset here as I bought a model S with cash through a ltd company in 2015 but you should realise unless you hoard cash, there are far more effective things you can do with that cash that will produce much better returns, making leasing even more attractive.
Even if you do nothing with the 56k a MY costs, you save about £1,560 on a 56k model Y over 3 years.
It depends on the leasing deal, but going into 4 year leases gets far more expensive, I found comparing multiple leasing deals from various companies the sweet spot for us is 3 years. 4 years they start to gain big.
If you remove CT write downs and VAT refunds and do this privately, its a different story, cash is cheapest but you need to keep it 7 years at least.
There is no doubt that the cheapest years of ownership at 4 to 7+ and that makes total sense as a cash buyer, but in a company, the state of a companies finances and growth could be vastly differently by year 7, of which some of that 56k could have sparked it.
You can easily overthink this, just focus on wether you are comfortable with the monthly payments.
