Buy Or Lease Vehicles For The Business?

Business By sweetlayers Updated 5 Aug 2010 , 12:57pm by sweetlayers

sweetlayers Posted 4 Aug 2010 , 6:59pm
post #1 of 5

The subject line is pretty self explanatory.

Is is smart for a business to lease or own delivery vehicles?

Can it be used 1/2 for business and 1/2 for personal or do you have to make a decision?

Any info on tax write-offs?

Can't think of anything else but please feel free to share your experiences and thoughts.

TIA

4 replies
SwtCanuck Posted 4 Aug 2010 , 7:19pm
post #2 of 5

I needed a new car and we researched all about whether to buy or lease and our accountant finally helped us decide that leasing was the way to go. If we were to buy we could only write off the intrest of the purchase (but that was 0%) and the percentage of all related stuff like gas and upkeep. If we leased the car we could include the lease payments along with the gas and upkeep (keeping a log of the km used). But then again this is Canadian tax laws.
I would talk to your accountant about the tax laws in your state/province.

ps. and this way I also get a new car every 4-5 years. Nobody wants to see their wedding cake being delivered in a beat up old car!

sweetlayers Posted 4 Aug 2010 , 8:24pm
post #3 of 5

Thanks SwtCanuck!

Anyone have a US perspective?

jason_kraft Posted 5 Aug 2010 , 4:00am
post #4 of 5

US tax law is the same way...lease payments are typically deductible as business expenses. However, if you buy the vehicle you may be eligible to deduct the full cost immediately via a Section 179 deduction (the vehicle must be used greater than 50% of the time for business purposes).

Here's more info from Nolo:
http://www.nolo.com/legal-encyclopedia/article-29714.html

sweetlayers Posted 5 Aug 2010 , 12:57pm
post #5 of 5
Quote:
Originally Posted by jasonkraft

US tax law is the same way...lease payments are typically deductible as business expenses. However, if you buy the vehicle you may be eligible to deduct the full cost immediately via a Section 179 deduction (the vehicle must be used greater than 50% of the time for business purposes).

Here's more info from Nolo:
http://www.nolo.com/legal-encyclopedia/article-29714.html




Oh jasonkraft, you're my new hero! Thanks for this info!

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