What is Business Leasing?
Business leasing is the commercial counterpart to private leasing.
Unlike private leasing, where an agreement is made between an individual and a leasing company or bank, business leasing involves a contract between a leasing entity and a legal entity, such as a company. This option is often used by small and medium-sized enterprises (SMEs) that require a vehicle for their business operations.
The advantages of a business lease include:
- Valuable capital is not bound into a vehicle and can be used to fund other investments within the company.
- The leasing rates can be deducted from the company’s taxes.
- Commercially leased vehicles can also be used privately. In this case, however, the private usage must be declared in the tax statement in order to align with tax regulations.
- SMEs and self-employed individuals who need professional mobility benefit from the same flexibility as in private leasing.
- The possibility of periodically upgrading to newer models or more premium vehicles may add an image of being up-to-date to the company’s presence.
Synonyms: Company Leasing, Corporate Leasing, Commercial Leasing