About to kick off a business lease on an i3 - options?

[RemarkLima]

Hi all,

I'm just about to say yes to a business lease for a new 94 ah BMW i3... First off, with a lease, it stikes me that I'm just funding the depreciation right?

That aside, I've just gone for the sport pack and the media pack... Are there any other options that are really worth while? It seems pretty well equipped as a base car but just in case there's something else to consider!

Cheers

[tharriso]

This is a quote I had off fulton leasing a fortnight ago if it is any help to you.

BMW I3 5dr Hatch eDrive Interior world Lodge 94A model
Metallic paint
Raid charge preparation
6+23
10k pa
£251.53+

[oop north]

It's dangerous asking for advice on options

Mine was a stock car and came with a long list that I replicate if ordering from scratch:

Sport pack includes LED dipped beam, rear tints, Harman Kardon speakers and 428/429 wheels. I am only really bothered about the LED lights (live in country so lots of time on unlit roads) and HK

I have the leather interior / wood dash - wouldn't bother to pay specifically for that

Pro nav - like that and would get again

Parking pack - quite like the camera but otherwise not bothered

So if getting new now would get LED lights, HK and pro nav - and metallic if I felt like it on the day!

[RemarkLima]

Thanks Oop North - that's pretty much what I've done... The parking pack seemed pointless, as it's an easy car to drive and park but the sport pack with LED's, HK and the wheels seemes worth it, along with the pro media, just for flashness.

The metallic paint actually lowers the cost (it's -£1.34 per month) on a business lease! So that's a no brainer

I've gone for the standard interior, as the Loft / Lodge are only part leather, so kind of pointless with kids and stuff... Either full leather for durability, or standard for cheapness.

Looking forward to it!

[ds666]

I've had a quote from bmw for a replacement for my current one . Virtually every extra , £341 per month on 10 000 mls p.a. Current one is £449/month ...

[n17ves]

If this is to be done via a business, would it not make more financial sense on a low emission car to purchase the car and make the most of the 100% 1st year capital allowance and government contributions on offer...

[ds666]

Only if you want to tie the business cash up in a car ?

[oop north]

Next time I might buy instead of using contract hire. That's more to gain flexibility though - the cash flow benefit of 100% first year allowance isn't actually al that exciting (though it avoids the problem of capital allowances continuing after you have disposed of a car - ie, taking possibly many years to get the full relief) - it's more of a guarantee that you get depreciation allowed against your corporation tax. The benefit is probably more if you are self-employed as the relief is possibly at 40% rathe than 20%

Anyway, I just hate being in any kind of fixed term contract and am not doing the miles that I have bought and might want to keep the i3 a bit longer or change sooner - but given my impulsiveness to change cars and do it too often the restriction is probably a good thing. Or at least that's what my wife would say

[n17ves]

ds666 said:

Only if you want to tie the business cash up in a car ?

You have the option to choose finance as opposed to buy outright

[RemarkLima]

n17ves said:

ds666 said:

Only if you want to tie the business cash up in a car ?

You have the option to choose finance as opposed to buy outright

Surely it's pretty much the same once the car is disposed of? Let's say you keep the car for 2 years, the lease costs would be the same as the depreciation costs and both come out of pre-tax profits right?

I can't say I know much about it, but the first year write off would be useful, but probably not at the scale of my wee business to be honest... That said, I do my work and leave the rest up to the accountant.

[n17ves]

RemarkLima said:

n17ves said:

ds666 said:

Only if you want to tie the business cash up in a car ?

You have the option to choose finance as opposed to buy outright

Surely it's pretty much the same once the car is disposed of? Let's say you keep the car for 2 years, the lease costs would be the same as the depreciation costs and both come out of pre-tax profits right?

I can't say I know much about it, but the first year write off would be useful, but probably not at the scale of my wee business to be honest... That said, I do my work and leave the rest up to the accountant.

Well Ive just had a quick look online and BMW are currently offering the i3 at 0% apr, plus the £4,500 government contribution and a further deposit contribution of £1k. Works out at £269/month with a £6k deposit over 2 years and a final payment of £14,630 to take the car away. What's a 2 year old i3 worth....£18k? If so, you'd end up with approx £3.5k equity in the car.

Im not sure how the above finance offer would work through a business (if even available), but it would as if you were basically getting a further 20% discount on the car (corporation tax relief) via capital allowances in the the first year.

I guess it all depends how much in total what the lease deal is working out to be over 2 years. The above is more hassle, but worth comparing numbers and a question to the accountant.

[RemarkLima]

n17ves said:

Well Ive just had a quick look online and BMW are currently offering the i3 at 0% apr, plus the £4,500 government contribution and a further deposit contribution of £1k. Works out at £269/month with a £6k deposit over 2 years and a final payment of £14,630 to take the car away. What's a 2 year old i3 worth....£18k? If so, you'd end up with approx £3.5k equity in the car.

Im not sure how the above finance offer would work through a business (if even available), but it would as if you were basically getting a further 20% discount on the car (corporation tax relief) via capital allowances in the the first year.

I guess it all depends how much in total what the lease deal is working out to be over 2 years. The above is more hassle, but worth comparing numbers and a question to the accountant.

I'll run the idea by him... It's all interesting to think of it the other way, especially as you then have the asset forever more (potentially). I think the numbers per month were about the same, just without the £6k up front. It's that part, as it'd be ~£3 pa that may make the numbers different, as I think the current one is ~£1k up front... THanks for the info, I'll speak with my accountant.