Business car leasing

Get the right car for your business using vehicle leasing.

If you're after a business vehicle but don't want to buy it outright, there are a number of flexible car leasing options to help get your business on the road.

Find out if business car leasing is right for you and compare your options below.

What are my business car leasing options?

There are various leasing options available if you’re looking to lease a car for your business. These include:

  • Operating lease. A leasing option that functions like a long-term car rental. Your business does not take ownership of the vehicle, but the lease is considered a tax-deductible business expense. With some operating lease options, you can incorporate the cost of insurance, repairs and other ongoing costs into your lease repayments.
  • Finance lease. Under a finance lease, the lender purchases the vehicle and then leases it to your business for an agreed term. You make regular lease repayments and will generally have the option to take ownership of the vehicle at the end of the lease term.
  • Fleet management. This is ideal if you already have cars in your business but want assistance with the administration burden and costs. You can outsource your vehicle management and benefit from an easily tracked and monitored way to manage your operating costs. Since you are outsourcing your fleet management, you are likely to benefit from discounts on servicing, repairs and the price of fuel. All vehicle costs are consolidated into one invoice, which reduces the administration burden on your business.
  • Commercial hire purchase. Like a finance lease, the lender will purchase the vehicle on behalf of your business and you will make regular repayments to cover the cost of the lease. Your business can claim an input tax credit for the GST contained in the purchase price of the vehicle.
  • Novated lease. This is a leasing option available to employees who wish to use their pre-tax income to cover the cost of the car lease. As the business owner, you will need to arrange for payments to be taken directly from the employee's salary.

How much will it cost my business to lease vehicles?

There are a number of different costs associated with various business vehicle leasing options. A fully maintained lease will include the cost of fuel, maintenance, registration and other ongoing costs in your repayments, whereas a non-maintained lease will simply cover the cost of leasing the vehicle. Your costs will also depend on the number, type and age of the vehicle(s) you choose to lease.

However, there are some costs that may apply, regardless of the vehicle leasing option you choose. These include:

  • Establishment fees
  • Monthly or ongoing service fees
  • An account maintenance charge
  • Charges for asking to vary the lease terms
  • A fee if the lease ends early which will be determined by the car leasing company
  • Direct debit dishonour fees

You will also have to cover any ongoing running costs if you opt for a non-maintained lease and this should be factored into the overall cost of your lease.

What features are on offer with business vehicle leasing?

Some of the features offered with business vehicle leasing include:

  • Reduced fleet administration costs.
  • Access to an online portal. Some car leasing companies offer an online portal so you can easily see fuel usage and servicing of your fleet of cars.
  • Peace of mind. If you get a fully maintained lease, you have the peace of mind of knowing that everything from fuel to roadside assistance is covered in the fee you pay each month.
  • Employee leasing options. Novated leasing allows employees to lease vehicles using their pre-tax income.
  • No requirement to buy the vehicles. As you’re leasing the vehicle, there’s no reason for you to now go out and spend thousands on a fleet of vehicles for your team. You can simply lease them and keep costs down.
  • Flexibility of lease. If your employee moves before the lease is finished, the lease of the vehicle follows them to their next job. This means that you don’t have to pay off a vehicle that is no longer benefiting your business as well as dealing with vehicle removal once the lease is up.
  • Set kilometre limit. Every business car lease has a yearly kilometre limit. This is agreed upon in advance and is usually about 16,000+ kilometres. This can give you peace of mind as you know that your employees aren’t driving around and racking up the kilometres on an asset for the business. If they do, there’s an additional mileage fee.

Is my business eligible?

Different lease providers will have their own eligibility criteria that your business will need to meet to be eligible for a business vehicle lease. These may include:

  • Have an Australian Business Number (ABN).
  • Be trading for a minimum period of 24 months.
  • Show your current debt and assets situation. This is because there are credit applications that need to be approved before you can start up a leasing agreement with a car leasing company. Good credit is also handy here, as the application will ask you for your credit score as well as your credit history.
  • Know the amount you want to borrow, as well as the asset you're looking to finance through a novated lease. To be approved for a novated lease from a business point of view, it's important that you know how much you want to borrow as well as the type of asset you're looking to finance. Entering this into your application shows that you're aware of the amount you want to borrow as well as what type of car you want to provide for your employee.

Have more questions about leasing a car for business?

Do I need a fully maintained or a non-maintained lease?

This is up to you. If you like overseeing repairs and maintenance for your fleet, go for a non-maintained lease. However, if you’re sick of having to look after it all, a fully maintained lease sounds like a better fit.

What’s the residual value risk of leasing a vehicle?

This varies from vehicle to vehicle. This is another term for the remaining value of an asset as it has fully depreciated in value over time.

Are the leases removed off my business balance sheet?

This depends on the car leasing company, but no business wants to own an ageing asset. Many will remove the vehicles from your balance sheet while maintaining the residual value risk themselves.

What other options do I have?

If business car leasing doesn't sound suitable for your business, you can instead finance your business vehicle using a car loan. Compare your options below.

Updated June 18th, 2019
$
Name Product Interest Rate (p.a.) Comparison Rate (p.a.) Min Loan Amount Loan Term Application Fee Monthly Service Fee Monthly Repayment
From 6.99% (fixed)
8.1%
$5,000
1 to 7 years
$295
$10
Finance a range of vehicles including cars, motorbikes, boats and caravans.
Apply online to finance a new or used motor vehicle and receive a response in 90 seconds. You will receive a competitive tailored rate of between 6.99% p.a. to 14.99% p.a.
5.69% (fixed)
5.97%
$25,000
1 to 7 years
$175
$0
Offset your interest with a Car Budget Account.
Take advantage of a competitive rate, pre-approval and no early repayment fees when you finance a car under two years old.
4.99% (fixed)
5.54%
$5,000
3 to 5 years
$400
$0
Optional balloon payment available to reduce your repayments.
A competitive rate car loan suitable for a new cor used car.
From 5.99% (fixed)
6.55%
$15,000
1 to 7 years
$399
$0
Benefit from 5-hour pre-approval.
A competitive rate car loan from RACV with no monthly fees.
From 5.34% (fixed)
6.6%
$7,500
1 to 7 years
$459.20 (for private seller vehicles this fee is $608)
$8.90
Fixed or variable rates starting from 5.34% p.a.
Apply for up to $150,000 and have up to 7 year(s) to repay. You can use cash or trade in a vehicle to use as a deposit.
From 4.99% (fixed)
6.23%
$10,000
1 to 7 years
$350
$5
You'll receive a fixed rate of 4.99% p.a. with a comparison rate of 6.23% p.a.
Get access to over 20 providers to fund a new or used car.

8.49% (fixed)
9.67%
$10,000
1 to 7 years
$250
$12
Use a new or used car as security.
A flexible loan thats lets you benefit from a car search tool as well as the option to borrow extra for on-road costs.
From 8.49% (fixed)
9.6%
$3,000
1 to 5 years
$195
$12
You'll receive a fixed rate from 8.49% p.a. based on the value of your car
Get a competitive rate and apply for a larger loan up to $80,000 when you attach a new or used car as security to the loan.
6.79% (fixed)
7.16%
$5,000
1 to 7 years
$265 ($175 Establishment Fee + $90 Security Administration Fee)
$0
Finance a new or used vehicle up to 7 years old.
Benefit from additional repayments, no ongoing fees and access to a redraw facility with this competitive loan from CUA.
From 7.99% (variable)
8.96%
$10,000
1 to 10 years
$200
$10
Your choice between secured or unsecured.
Apply for a loan up to $75,000 and benefit from loan terms up to 10 years.
From 5.99% (fixed)
6.55%
$5,000
1 to 7 years
$399
$0
You'll receive a fixed rate from 5.99% p. a.
Purchase a new car with this loan and benefit from a fixed rate and no monthly fees. Pre-approval available within 5 business hours.
6.69% (fixed)
7.04%
$2,000
1 to 5 years
$250
$0
Secure this loan with a car and use the funds for any purpose.
Competitive 6.89% p.a. rate available to all approved applicants. Loan amounts up to $60,000 available.
From 7.24% (fixed)
7.8%
$5,000
1 to 7 years
$399
$0
You'll receive a fixed rate from 7.24% p.a.
Finance a used car with NRMA and benefit from a fixed rate term and no monthly fees. Pre-approval available within 5 business hours.

Compare up to 4 providers

You might also be interested in

Rates last updated June 18th, 2019
Name Product Card Type Annual fee Additional Cardholder Fee Rewards Program Product Description
Caltex StarCard
Fuel
$35.40 p.a.
Qantas Business Rewards
Minimise your monthly fuel expenses, save up to 4 cents per litre and collect up to 50,000 bonus Qantas Points on eligible business purchases.

Compare up to 4 providers

Was this content helpful to you? No  Yes

Car Loan Offers

Important Information*
Logo for Latitude New and Used Car Loan
Latitude New and Used Car Loan

You'll receive a fixed rate between 6.99% p.a. and 14.99% p.a. based on your risk profile
Apply for a loan from $5,000 to finance a new or used car. Flexible repayments and options to finance a classic car.

Logo for Beyond Bank Low Rate Car Loan "Special Offer"
Beyond Bank Low Rate Car Loan "Special Offer"

You'll receive a fixed rate of 5.69% p.a.
Take advantage of a competitive rate, pre-approval and no early repayment fees when you finance a car under two years old.

Logo for Loans.com.au - New Car Loan
Loans.com.au - New Car Loan

You'll receive a fixed rate of 4.99% p.a.
Finance a new car and benefit from features such as fast approval, no ongoing fees and an optional balloon payment.

Logo for RACV New Car Loans
RACV New Car Loans

You'll receive a fixed rate from 5.99% p.a.
A larger loan of $15,000 or more to help you buy a new or used car. 5-hour pre approval available and no ongoing fees. Note: Product only available to residents of Victoria.

Ask an Expert

You are about to post a question on finder.com.au:

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • finder.com.au is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, or seek advice before you decide to act on our content. By submitting a question, you're accepting our Terms of Use, Disclaimer & Privacy Policy and Privacy & Cookies Policy.
Ask a question
Go to site