Leasing or Buying, What are the Differences?

Loading Vehicle Picker...
Initialising Vehicle Picker...

Leasing or Buying, What are the Differences?

Posted on by carbroker

In today’s day and age, we’re lucky: there are so many ways of going about securing a new ride. You’ve got a few different options available if it’s time for you to upgrade your wheels, and two of the most commonly compared methods of doing this are leasing and buying.

So, you understand the main difference between the two: with a lease, you essentially don’t own the vehicle, and with buying a car, you do own it. But what are the little juicy nuggets of information that you only find out when you delve deeper? In this post, we’ll explain!

Leasing

Car leases, also known as novated leases, are when you pay a monthly fee to use a vehicle. You don’t own the car; you’re leasing it over an extended period of time. Many car drivers love the flexibility that comes with novated leases, as they get to enjoy driving their car without paying the larger upfront cost that comes with buying a car. There are a couple of different types of car leases:

  • Operating lease
    An operating lease is more like a rental agreement – you pay a monthly fee to drive the vehicle, and hand it over when the lease ends.
  • Finance lease
    There are a few variations of finance lease. You can set a monthly lease payment and choose to pay a residual at the end of the lease in order to purchase the car outright; or you can choose to swap the car over and continue paying monthly payments.

Lowering your taxable income

As an employee, you can choose to receive your salary as a combination of cash and approved benefits. These benefits are either tax-free or taxed at concessional rates. Replacing some of your cash salary with benefits enables you to lower your taxable income to increase your overall after-tax pay.

Buying

Buying a vehicle is the more traditional method of driving your dream ride around. When you buy a vehicle, you either pay for it outright, or you get a car loan in which you pay a deposit and then pay monthly fees until it’s paid off.

If you’re using your vehicle for business purposes, you’re also able to reduce your payable tax by deducting some of the purchase price and running costs as a business expense.

Which is better?

The question everybody wants to know the answer to: which option is better?! There’s no universal answer to this, because everybody’s circumstances are different. For one person, buying might be better and for another person, leasing might be better. Either way, make sure you chat to the experts at Carbroker.com.au before pulling the trigger. They’ll use their connections with over 2,000 Aussie car dealerships to find you the best deal whether you’re wanting to buy or lease a vehicle. Get in touch with Carbroker.com.au and get into your dream car sooner.

Testimonials

I've been with the RACV for over 10 years. I just didn't realise what a premium I was paying for the service. Going with your car insurance recommendation and the roadside assist is saving me several hundred dollars every year!

C.A., Ballarat

Delivering what you promise is the foundation of good business. I am sure that's why you sell so many cars for people like myself. Keep up the good work!

L.B., Sydney

Just picked up the Madza and we are both delighted with the price and the service. Your service is brilliant ... I can't of a better way to buy a new car. On behalf of Val and myself a BIG THANK YOU!

K.J., Melbourne

Your manner and professionalism on the phone is excellent. It was a real pleasure to deal with you. I wish you the best in the future, and you can rest assured I will be back!

M.F., Sydney

I picked up my new Nissan Patrol on Friday afternoon. I would like to thank you for all the work you did on my behalf and the fantastic price you secured my new car for. It was so good not to have to do the rounds of the car yards and try to beat car sales people at what they do best. Your website was also great with tips on how to sell my other car as well as all the other information available on it. The dealership was very professional as well and the car was ready as promised and in a very nice condition.

B.W., Queensland

Thank you again. I could not have asked for better service. Having been faced with unhelpful dealers it was just so easy to place a Internet request on Thursday and to be in a new car Monday afternoon, it was more than I could have asked for. I would definitely recommend the services that you provide, without hesitation.

P.H., Canberra

I am very pleased with the outcome, and I will certainly recommend it to my friends in the future.

D.F., Sydney

I received my new car last week which was the fisrt time I set foot on a car lot during this and it was one of the most painless experiences! I have and will continue recommending your services to all my friend and colleges. Thanks for the prompt, professional service and the huge savings.

C.J., Brisbane

I’d just like to comment on how smooth it was to purchase my car using your service. The finance broker you put me on to helped the hip pocket as much as the price you were able to secure for me. Thank you so much for making a major purchase easy, smooth and without buyer’s remorse. I will be looking you up when it comes time to replace our other car and I will continue to recommend you to all my family and friends

M.P., Melbourne

It is a sorely needed service as we have had nothing but stress and grief with the dealers we have approached ourselves.

J.F., Melbourne

Carbroker.com.au