“Lease Personally or Through Your Business?” 🚗

 

🚘💼 Let’s make the numbers work for you. 

 

🔍 Lease Through Your Company 

 

If you're self-employed or run a limited company, this question is probably on your radar. 

Let’s break it down. 

 

 

 

📌 Do you actually need a car for your business? 

📌 Will it genuinely help you work better, win clients, or improve efficiency? 

📌 Or are you just looking for a tax break? 

 

💡 Tax efficiency is great, but the car has to make business sense first. 

 

 

🎯 Meet Sam, a freelance photographer. 

 

Sam’s old car is unreliable and gives off “budget DIY” vibes when arriving at weddings and brand shoots. 

 

He’s thinking about a business lease for a newer, reliable, professional-looking vehicle. 

 

 

👉 Lease through the business and deal with company car tax? 

👉 Lease it personally and just claim mileage? 

 

 

Leasing Through Your Business (Ltd Co) 

 

💼 Pros: 

 

✅ Lease payments reduce Corporation Tax 

✅ VAT can be reclaimed (up to 100% in some cases) 

✅ No personal liability – the agreement is with the company 

✅ Potential access to better deals 

✅ Repairs & servicing may be included 

 

BUT… 

 

📉 If you use the car personally (even to commute), you’ll pay Benefit in Kind (BiK) tax. 

 

 

🚗 Company car = a Benefit in Kind if used for personal trips 

🏠 Driving it home counts 

📊 BiK tax is based on: 

– CO₂ emissions 

– The car’s value 

– Your income tax rate 

 

⚡ Electric cars = lower BiK 

 

🚙 Petrol SUVs = higher BiK 

 

That’s why choosing the right car is just as important as choosing how you lease it. 

 

👤 Pros: 

 

✅ No BiK tax 

✅ The car is yours — even if you sell or close your business 

✅ Claim 45p per mile for business travel (first 10,000 miles) 

✅ Lower monthly costs with PCP-style deals 

✅ Great if you’re a sole trader or home-based 

 

BUT… 

 

🔧 You can’t claim repairs, insurance, or finance payments, just mileage. 

 

 

Business Lease Personal Lease 

 

Tax Relief on Payments ✅ Yes ❌ No 

VAT Reclaim ✅ Up to 100% ❌ No 

BiK Tax Payable ✅ Yes (most cases) ❌ No 

Ownership Option ❌ Usually not ✅ Often (PCP) 

Mileage Claim ❌ Not applicable ✅ 45p/mile 

 

Commercial Vehicles (Vans & Pickups) 

 

🛻 Different rules apply! 

 

If it’s a van or pickup: 

 

✅ Simpler tax 

✅ Flat-rate BiK — much cheaper than cars 

✅ Ideal for trades and gear-heavy businesses 

✅ Electric vans = 0% BiK 

 

🚨 Even driving home in the van is a taxable benefit, but much lower cost. 

 

 

🌱 The government rewards eco-conscious business owners. 

 

🚘 EVs and hybrids: 

 

✅ Lower BiK tax 

✅ Exempt from ULEZ or congestion charges 

✅ Often cheaper to run 

✅ Help boost your brand’s image too 

 

💡 Leasing an EV through your business = big tax wins with the right setup. 

 

So… What Should You Do? 

 

It depends on: 

 

✔ How often you use the car for business 

✔ Whether the car impacts your client experience 

✔ Your company structure (sole trader vs limited) 

✔ Budget + cash flow 

✔ Environmental goals 

 

💬 One size doesn’t fit all. Speak to someone who can help you tailor the best deal for your situation. 

 

TL;DR Recap 

 

Lease through business if: 

 

✅ You want tax relief + VAT back 

✅ You’re OK with BiK 

✅ You need a professional-looking car full-time 

 

 

✅ You want to avoid BiK 

✅ You drive occasionally 

✅ You’re claiming mileage instead 

 

Need Help Working It Out? 

 

💡 Still unsure? Don’t guess. 

 

Send us a DM or book a call. We’ll help you compare all the numbers and make the right move for you and your business. 

 

📩 Want to make the best financial move for your business? 

 

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