Company Vehicle questions. What do you guys have? Is it worth the cost?

[drnick5]

Hey folks,

I've been looking into the possibility of getting a company vehicle. I've bought plenty of cars for myself and am quite familiar with the process, but i'm not sure what is different when buying commercially. 2 out of our the 3 techs don't have reliable vehicles to make long trips. While most of our jobs have been nearby, we've been getting more and more work 30-60 minutes away from our location (that qualifies as long distance in my state!). So we're hoping to have at least 1 reliable car at the ready at all times.

My business partner has been eyeing the Ford Transit. I personally think its bigger than we nbeed, and not great on gas. I'm of the mind that a hatchback might work just as well with much better gas mileage. (Based on how often we haul large items, which isn't often, usually just a computer tower or 2, the occasional pedestal or 2U server). Am looking for some opinions on either option.

While the Transit would have room to sort of make it a 'mobile work bench" but i'm not sure how practical that is or how often wed make use of that functionality. I'd also be looking to getting the car lettered with our company logo.

I think a hatch back like a Toyota matrix, Honda fit or similar type vehicle (read, not a small toyota yaris) would work just as well. But i'd like to hear form folks who may have bought one vehicle and regretted it, or have been happy with the decision.

As far as loans and insurance go, I'm assuming getting a commercial loan is more difficult than a personal one?

Any other things to think about? Suggestions? Tips? Tricks?

Thanks in advance!

 

[lsi]

I've also debated this but have no clear answers. What I do now is give my onsite techs a vehicle reimbursement. This way I am paying them for using their personal vehicles and they can also file for miles reimbursement when they do their taxes (or so I'm told). At one point I thought it might be a good idea to get some work vehicles but then I would have to worry about things like commercial insurance (supposedly higher rates than personal vehicle insurance), fleet repairs and maintenance, office politics about who gets a car and can I drive it home, depreciation, gas expense tracking, etc. Eventually (when we are making a lot more money) I would still like to get some vehicles for the following perceived benefits:

-perk that makes hiring easier
-branding
-fleet tracking
-company will actually have assets

 

[untoldtech]

I did a honda fit, works great seats fold down can fit most things in it. The newer models get even better gas mileage I hear.

 

[e2346437]

My fleet is all Prius. I won't consider anything else.

 

[Rztech]

We use a Lincoln Navigator for our visits - it's perfect for fitting everything, we can put inventory in a bottom compartment that opens open and can be locked. We couldn't go back to smaller cars again.

 

[Montrose Computers]

+1 on getting a Honda Fit. Best car I have ever owned. Great gas mileage and reliability. Unbelievable the amount of storage space inside, they don't call it the FIT for nothing. The flat back window was great for signage. I had vinyl signing placed on the back and the 2 rear side windows. Then just get yourself some PC-FIXN vanity plates and your ready to roll.

 

[phaZed]

Good call on the PC-FIXIN license plate! Lol

 

[SprinterTech-WI]

bought a new kia rio in Sept, so far so good, I have put on 8,000 miles since and no complaints - even fit me and another tech, our bags, a 22' versaladder, 4 large bins of tools, 7 boxes of cat6, fish poles, sticks, and the like... still got 36mpg for 750 miles

 

[lsi]

i'm hearing lots of vehicle make/model suggestions but no real information on buying commercially? Did you guys buy your vehicles in the company name? Or are they personal vehicles under your own insurance? Were there any different considerations or advice for buying a vehicle as a company asset?

 

[PCSupportGlasgow]

See your accountant who will tell you the best option for your business. Only someone with your business financial information can work out what is for the best cost, tax allowance,etc.

Not sure about where you are but here in the UK the wrong choice can cost £1000s per year.

 

[SIBIT]

See your accountant who will tell you the best option for your business. Only someone with your business financial information can work out what is for the best cost, tax allowance,etc.

Not sure about where you are but here in the UK the wrong choice can cost £1000s per year.

Agree with this i was about to get a Range Rover and found out getting a Pick Up Truck as a business vehicle saved me 8k a year in Benefit in Kind Tax.

the pick up being classed as a Commercial Vehicle saved me so much!

Not sure about the states but as above accountants should know!

 

[frederick]

Definitely see your accountant/CPA/guy knows more about money than you. There are some huge pros, and some huge cons to purchasing vehicles and then writing them off as a business asset depending on the business size and all that stuff. Chances are, depending on your company size, your accountant will give you two options:

1) Buy a new personal vehicle, get wrapped, and everything is considered to be paid for out of your personal accounts (maintenance, gas, etc.). At the end of the year, thanks to a ledger you kept for all the driving you did, to include personal, you can start writing off all the business miles.
2) Buy a business vehicle that is strictly used for business purposes and is paid for and maintained by the business, and the company even owns the insurance on it.

The IRS rules are so confusing, so see a CPA (not a part time tax man). You need real professional advice, not someone to just do your taxes. Also, if you are a non-LLC non-Corporation, etc., do it yourself sole-proprietor, it'll for the most part be a personal loan (it'll be under your trade name) but they only look at your credit score. For an LLC like us, all partners for the most part have a credit check, and the business has one. So far, all loans our company has taken out have been in a partners name for the company (my CPA said it's like a DBA but for loans). Either way, the business is generating credit which is important (we are an LLC btw).

There is some advice and some of my experiences with the whole thing. It's all confusing as hell, and at the end of the day, I'm just thankful for an English (American) speaking CPA.

 

[Davena]

Hummer

 

[ComputerPro]

Vehicles

We have a full size van but got a Ford Fiesta a couple of years ago. I should have gotten the Focus in hindsight. Fiesta is tiny! Gets great mileage though 39 etc. Works for us unless we are doing a wiring job or need ladders then we need to roll the van or something bigger.

As for commercial loans, depending on if you can get one or not, if not just get it personally and then lease it to the company.

Insurance is a little different but should have good rates, esp if you have your general liability with the same company. We have one company that does all our business insurance.

 

[HCHTech]

Ditto on the accountant being the one to lay out the pros and cons for your particular business. In my case, I took my accountant's advice to stay with a personal vehicle and pay myself mileage (I do the same for my other tech). Every business is different. My usage is about 90% business and 10% personal, so I was surprised that the best answer was to own it personally.

Note also that since I do primarily residential service in a city with a large blue-collar population, I was cognizant of what the vehicle itself "said" about my company. I didn't want too fancy of a car, for example. "Oh, you drive a BMW? No wonder you're rates are so high!" I also stayed away from trucks or other 4WD vehicles for the sheer expense of it. I have one or two days each year where the snow is bad enough to make me cancel calls - that's not a big enough percentage to take on the expense of 4WD the other 363 days.

Note that if I was in a farming community or a place that got more snow, for example, I'd probably drive a different vehicle.

In the end, I chose a Prius. I've had 105K trouble-free miles, will probably buy another one in the spring, and I get between 36 (winter) and 46 (summer) mpg. I've got nothing bad to say about it. When the next thing goes wrong, it will be the first thing. I've put gas, oil, tires, brakes & other wear parts into it, but that's all. I bought it off a one-year lease so it was a pretty good deal as well.

My other tech drives a Honda Fit. Not as good mileage, but a pretty good car and holds lots of stuff. Just a bit too small for me, but he likes it.

 

[phaZed]

I didn't want too fancy of a car, for example. "Oh, you drive a BMW? No wonder you're rates are so high!"

Your area may differ, but I would hazard to say - A fancier car is better for business. It shows success in your business. It's the same as a salesman having a $100 Cross pen and a nice suite. Fancy sells and inspires confidence from a sociological stand point.. and that's proven.

On a separate note, my BMW cost as much as a Honda Fit.

 

[Davena]

Your area may differ, but I would hazard to say - A fancier car is better for business. It shows success in your business. It's the same as a salesman having a $100 Cross pen and a nice suite. Fancy sells and inspires confidence from a sociological stand point.. and that's proven.

On a separate note, my BMW cost as much as a Honda Fit.

I have to agree on this. ^^^^^

 

[ohio_grad_06]

I'm on the other side, lol. Right now I have a 2000 Ford Taurus, I take it many times when I'm going out, but still looks decent. We got it with 109,000 miles 5-6 years ago for 3200 dollars I think. It now has 192,000 and still going. Can't complain on it. I go 500 miles a week or so in it. Plus we paid it off in like 18 months. And it's got a decent amount of space. They seem like up to the 2007 or so models are cheap to pick up. Might be something to consider. One mechanic said I should be able to get 300,000 out of it if I maintain it. This is my personal vehicle, but if you find one in nice shape, may not be a bad idea for something for your techs to putt around in with some magnets or a wrap.

Although there may be something to be said about a nicer car. Even if you have a cheaper car, probably a good idea to have one that looks like it's been well maintained and that someone cares about it, as that would be a reflection of how you take care of their equipment.

 

[mlcomputers]

Hello

I have just purchased a small van called a Fiat Fiorino for my business here in France.

I wanted a van that was not too large, but would have enough capacity for my toolkit, stock, and collecting and returning equipment from my customers premises.

Fuel economy is excellent (Diesel) as I drive between 600-800 Kilometer per week.

Total cost new was €13000

 

[SpaceSquad]

Hello

I have just purchased a small van called a Fiat Fiorino for my business here in France.

I wanted a van that was not too large, but would have enough capacity for my toolkit, stock, and collecting and returning equipment from my customers premises.

Fuel economy is excellent (Diesel) as I drive between 600-800 Kilometer per week.

Total cost new was €13000

Pretty cool, doesn't look much bigger than my Mazda3 Hatchback, though