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Cash or loan

  • 02-02-2016 1:38pm
    #1
    ammg
    Registered Users, Registered Users 2 Posts: 106 ✭✭


    A friend of mine is buying a commercial van for work (self employed) Should he use cash or a loan?

    What are the best finance deals out there?
    Where should he invest for a guaranteed return which will beat the loan rate?

    All help appreciated!


Comments

  • #2
    Atlantic Dawn
    Registered Users, Registered Users 2 Posts: 84,761 ✭✭✭✭Atlantic Dawn
    M


    If he has a business the best option would likely be to lease it. All depends on his cash flow, if this year say he made huge profits he didn't expect to make again then it might be worth buying the van for cash to offset the tax liability, he should really ask his accountant.


  • #3
    grogi
    Registered Users, Registered Users 2 Posts: 8,616 ✭✭✭grogi


    Atlantic Dawn wrote: »
    If he has a business the best option would likely be to lease it. All depends on his cash flow, if this year say he made huge profits he didn't expect to make again then it might be worth buying the van for cash to offset the tax liability, he should really ask his accountant.

    Buying cash or from finance does not change (almost - ignoring the interest) the amount you can reduce the tax liability. Typically with purchases like that you are obliged to spread the cost over couple of years.

    It is different if you're a garage and buy a car with the intention of selling, then the whole purchase is your immediate cost.


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