If you own a business and your work involves having to drive to meet clients, you need to consider whether your personal vehicle is suitable for work use. There are some cases where it could be better for you to buy a separate business vehicle. That said, you may find that your personal vehicle does the job. Below are a few questions to help you decide whether to stick with your personal vehicle or whether to buy an additional work vehicle.
Does your personal vehicle look professional?
Ideally, you want a vehicle that projects a professional image. Think about what your vehicle says about your company. An old scratched up vehicle with missing hubcaps could make your company appear outdated, sloppy or reckless. A showy sports car could meanwhile suggest to clients that you overcharge.
Ideally you want a relatively modern mid-range car in good condition. When dealing with high end clients, you may want to opt for something a little classier, but nothing too sporty. Vans can often project a professional image – especially when working in a trade.
Does it suit the practical needs of your business?
You also need to consider the practical needs of your business. If you’ve only got a small car and you want to be able to transport large equipment or materials to jobs, you may want to consider upgrading to a larger vehicle.
A vehicle with good fuel economy could meanwhile be important if you’re going to be driving long distances. If your current vehicle guzzles fuel, consider whether it’s worth finding something more fuel-efficient.
Can you afford an extra vehicle?
Owning a company vehicle and a personal vehicle could get expensive. It means paying another ongoing insurance scheme, keeping both vehicles serviced, taxing both vehicles and possibly paying loans on two cars if you buy both on finance.
It may not always be as expensive as you imagine though. It’s always important to shop around for insurance. Sometimes you can save money with a specialist insurer – for instance, if you need to take out van insurance, here could be a place to look. Some insurers may also offer multi-vehicle discounts. Instead of buying a car, you may also find it more affordable to lease.
What about the financial and legal benefits of a separate company vehicle?
Having two separate vehicles can have financial and legal benefits. Firstly, owning a separate business vehicle allows you to more easily separate business expenses and personal expenses when filing taxes – all expenses involving your business vehicle can be easily claimed as business expenses. If you have a limited company, you can also make your company vehicle the property of your company, instead of being personal property. This means that if you accumulate personal debt that you cannot pay off, a debt collection company will only be able to seize your personal vehicle and not your company vehicle. You may also be able to take out company loans using your company vehicle as collateral.
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