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BUSINESS STAGE : SETTING UP
3 mins read
As your new business starts – or your existing business expands – you’ll no doubt begin considering purchasing a vehicle through your business, or adding another to your existing fleet. You may already have an idea of what vehicle you want, but there are plenty of other considerations that are good to think over.
If you’re a builder, electrician or rural producer, your entire business operations may well rely on your vehicle. In this case, you may need a secure and covered vehicle with plenty of room for tools and equipment, organised and easily accessible for quick access.
Did you know that our Toyota Dealer can help plan the entire fit out of your vehicle? This way you can get on with your work, while we organise experts to create the perfect work vehicle for you.
For tour operators and private bus companies, your vehicle doesn’t just help your business, it is your business. That means the vehicle, fuel and upkeep could be tax deductible. Of course if you’re claiming tax deductions, it means you’ll have to keep on top of your records. Reading our guide for keeping track of tax expenses may help.
The full cost of a vehicle doesn’t end with monthly repayments. You’ll also need to account for the insurance, repairs and servicing, maintenance and weekly petrol. These extra costs can have an impact on your cash flow, so ensure that you’re accounting for them.
But if your business uses passenger vehicles, like a Toyota Camry, Corolla, Yaris, RAV4 or C-HR you have the choice of a hybrid engine. Hybrids are cost effective to maintain, and competitive in terms of the total cost of ownership. Consider how much travel you’ll be doing with your business, then take a look at the Toyota Hybrid range to find out how much you could save in the long run.
It may be difficult to predict this, but this is a key question when it comes to the tax deductions you may be able to claim at the end of the financial year. Certain tax deductions will require the use of a logbook to prove the vehicle was used for work. If you or an employee plan to use the vehicle mostly for personal use, there may be better suited options, like a novated lease you could apply for when you purchase your business vehicle with your ABN.
To help you work out which form of financing suits you, have a read of our article, business vehicle finance, explained.
Is this vehicle just an interim plan, or will it serve your business for a long time? Remember that owning the vehicle outright may not always be the best option for your business. Certain business vehicle leases allow you to change the vehicle to a bigger or smaller option if things change, or simply cancel the agreement. Leasing, renting or hiring may also be better for cash flow, and small regular payments may suit you better than a big one-off payment. It also avoids having to calculate depreciation, which can get complicated.
We suggest reading our vehicle depreciation guide to get an idea of what this could mean for you..
No doubt, this is an exciting time for you. Your first business vehicle (or your first expansion) is a huge milestone. There’s certainly a lot to consider, and you’ll probably find that more than one option is suitable. The best place to start may be to speak with a Toyota Dealer, they know their way around this subject as well as you know your own business.
Disclaimer
This information provided is of a general nature and for information only. Nothing in this article constitutes or should be considered to constitute legal, taxation or financial advice. Before making a decision about any of the products and services featured on this article, you should consult with your own independent legal, taxation and financial advisors, who can advise you about your personal circumstances.
Our business mobility guide helps you better understand vehicle ownership across every stage of your business.