Cars: Your Accountant Will Agree - Leasing a Car For Your Business is the Way To Go

One of the many important financial decisions of a business owner is whether to lease or purchase motor vehicles for the business. RK Auto Group recommends leasing for several reasons: Leasing strengthens your financial statement and upgrades your company's image by providing sharper-looking vehicles at a cheaper price.

Most accountants agree: your financial statement looks rosier with vehicle leasing.

Financial benefits of leasing include:

�A better tax write off - you can deduct actual payments instead of using a depreciation schedule

�Clearer bookkeeping - while a lease is simply an expense on the financial statement, a purchase is an asset and a liability

�More borrowing power - with a lease, you can keep lines of credit open for other expenditures; a purchase of a vehicle ties up those loan options

�Preventing negative equity - this happens when you purchase a car: sometimes the market conditions make the vehicle worth less than the debt owed on it

�At RK Toyota, we have learned that when you don't have negative equity, you have less to negotiate in leases

In working with business owners, RK Subaru believes that by leasing, you improve your company's image.

When you lease a vehicle, you don't pay for all of it. You only pay for the part of the vehicle you use. This means:

�A lower monthly payment. Monthly lease payments usually average about one-third less that loan payments on a comparable vehicle.

�A lower down payment. This leaves you with more cash to invest in your business. For example, if you buy a $25,000 auto with a 20 percent down payment and 3.2 percent sales tax, your initial costs will be $5,160. You may be able to lease the same car for as low as $500 in up-front charges.

�You can afford a more expensive vehicle to better represent your business (and it's more fun to drive!).

�You drive a new vehicle more often: a 48-month lease costs the same monthly amount as a 60-month purchase of the same vehicle! When it is time for a new car, there are no concerns about getting rid of the old one.

Make sure to lease from a reputable dealer, such as RK Subaru or RK Buick, for consistent, high-quality service.

When you lease a vehicle, you form a strong relationship with the leasing representative, because you work with the same person on every lease. Our agents at RK Toyota, RK Subaru, etc. know that leasing provides a satisfying experience as well as great financial benefits to your company.

?2006 RK Auto GroupTom Kline is Controller of RK Auto Group (RK Buick: www.rkautogroup.net/buick.htm, RK Chevrolet www.rkautogroup.net/chevrolet.htm, RK Subaru, RK Scion and RK Toyota www.rkautogroup.net/toyota.htm.

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Cars: Your Accountant Will Agree - Leasing a Car For Your Business is the Way To Go

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