There are a number of factors to think about, technical specification, health & safety, true whole life costs, employee preferences are just a few. Let us help you navigate through this complex decision process so that you have the optimum policy in place for your business needs.

This can be very complex, cash flow, personal and business tax, whole life costs are just some of the key elements to consider. Utilising our bespoke and highly spophisticated financial modelling tools we can help you understand how these factors vary by product and what is best for you.

Specific products have different employee Benefit in Kind impacts. We can model what the potential BIK impacts can be for your employee base dependent on your potential product selection and choice of vehicles. 

Dependent on your VAT status, funding product and business usage there are restrictions on the amount of VAT recoverable. We can model different products and their tax treatment so that you can make an informed decision on what really is best for your business.

Understanding your vehicle usage requiements is critical to effectively manageing your costs, wherther this relates to annual mileage or activities your vehicles will be used for. We can look at the options available to you and potential scenario planning.

Fleet funding isn’t just about costs – it’s also about how your vehicle assets appear on your company’s books. The difference between on-balance sheet and off-balance sheet funding can affect everything from your cash flow to credit ratios and financial reporting.

Here’s how to navigate the options and choose what’s right for your business.

🔍 What’s the Difference?

🧾 On-Balance Sheet Fleet Funding

This means the vehicles (or leased assets) appear as an asset and a liability on your balance sheet. Common with:

• Hire Purchase
• Finance Lease

You’ll usually:

• Capitalise the vehicle
• Claim tax relief via capital allowances
• Take responsibility for depreciation and disposal

✅ Good for asset ownership and long-term value retention
❌ Impacts gearing and liquidity ratios

🧾 Off-Balance Sheet Fleet Funding

Vehicles do not appear as owned assets or liabilities. Common with:

• Operating Lease
• Contract Hire

You pay a monthly fee, and the leasing company owns the vehicle. At the end of the term, you hand it back.

✅ Predictable costs and cleaner balance sheet
✅ Avoids depreciation and disposal risks
❌ You never own the asset

📊 What Changed with IFRS 16?

Under newer accounting standards (IFRS 16), most leases now appear on the balance sheet, even for contract hire — unless they meet “low value” or short-term exemptions.

That said, the financial and tax treatment still differs, so it’s important to review the impact case by case.

💡 Key Considerations for Choosing the Right Option

• ✅ Do you need to protect borrowing capacity or financial ratios?
• ✅ Are you more focused on cash flow or asset ownership?
• ✅ Are tax allowances or residual value important?
• ✅ Do you want end-of-term flexibility?

🤝 Let’s Talk Fleet Funding Strategy

At Let’s Talk Fleet, we’ll help you:

• Compare on vs off-balance sheet funding models
• Forecast cash flow and tax impacts
• Choose the most strategic approach for your vehicle policy and business goals

📞 Book a Fleet Funding Review Today

Not sure what works best for your balance sheet or boardroom? Let's talk about what suits your business.

👉 Contact Us

We can look into this. You may have specific On or Off balance sheet requirements. please see below an important update that may impact your company.We can help you choose the right product and structure in conjunction with your finance team to deliver what you need.

IFRS 16 Update : For Publicly quoted firms that report to the International Financial Reporting Standards and the public sector

New lease accounting rules effective from 1 January 2019.

How Flexible Should Your Fleet Be?

In today’s fast-moving economy, fleet flexibility isn't a luxury it's a necessity. Whether you're adapting to market shifts, seasonal demand, or evolving technologies like EVs, having a flexible fleet strategy can give your business a serious competitive edge.

What Does a Flexible Fleet Look Like?

A flexible fleet adapts quickly to change whether that’s scaling up, switching vehicle types, or adjusting funding models. Here’s what to consider:

1. Contract Flexibility

Are you tied into long leases, or can you scale up and down as your business needs evolve?
 Look for short-term rental options or variable lease terms that let you adjust without heavy penalties.

2. Mixed Vehicle Access

One-size-fits-all fleets are outdated. Can your fleet accommodate electric vehicles, hybrids, vans, or specialist vehicles when required?
Build a fleet mix that supports both operational needs and driver expectations.

3. Geographic Agility

If your business operates across regions, can your fleet support multiple locations with consistent service and delivery?

National contracts and mobile servicing are key for multi-site operations.

4. Pay-as-You-Go Models

Does your fleet strategy support usage-based contracts for short-term or project-based work?

Flexible leasing and vehicle subscriptions can reduce cost and risk for variable workloads.

Who Needs a More Flexible Fleet?

• Start-ups and scaling businesses
• Companies with seasonal peaks (e.g. retail, logistics, agriculture)
• Organisations moving toward electrification or salary sacrifice schemes
• Teams with hybrid or remote field workers
• Businesses reassessing risk and cost post-COVID/Brexit

Why It Matters

An inflexible fleet can:

• Drain capital
• Cause operational bottlenecks
• Limit your ability to respond to new opportunities or threats

A flexible one improves:

• Cash flow
• Employee satisfaction
• Risk management
• Operational agility

How Let’s Talk Fleet Can Help

We work with businesses of all sizes to build flexible, scalable fleet strategies. Whether you're reviewing contract terms, introducing EVs, or managing a diverse workforce, we’ll help you find the right blend of:

• Funding models
• Vehicle access
• Risk control
• Strategic support

Let’s Talk About Making Your Fleet More Flexible

Book a consultation today and futureproof your mobility strategy.

We can design a tailored fleet policy to cover all your specific needs, using the right funding platform to minimise your costs and meet your operatinal requirements.

This can be complex, but need not be. All vehicle financing products have specific corporation tax considerations so let us review your requirements and help you choose a financing method that will meet your specific needs.

If your business has cash reserves, it might be tempting to buy vehicles outright instead of using finance or leasing. On the surface, it seems simple: no interest, no monthly payments, no complications.

But is using your company’s capital really the most efficient and strategic way to fund your fleet?

Let’s explore the pros, cons, and alternatives.

Pros of Using Cash to Fund Fleet Vehicles

• No interest or finance costs
• Full ownership from day one
• No credit checks or lease approvals
• No long-term commitments or early termination fees

The Downsides of Paying with Cash

While it might offer control and simplicity, buying vehicles outright ties up capital that could otherwise:

• Be invested in growth or innovation
• Boost liquidity or provide a safety buffer
• Deliver higher returns elsewhere in the business

Plus, you bear the full risk of depreciation, and resale values can be unpredictable.

Is Cash the Most Tax-Efficient Option?

Not necessarily. With leasing or contract hire, payments are usually fully deductible against taxable profits (depending on CO₂ emissions). Buying outright means relying on capital allowances which can vary by vehicle type and usage.

Finance also allows for predictable monthly costs, useful for budgeting and cash flow planning.

Smart Alternatives to Cash Purchase

1. Contract Hire / Operating Lease
A popular option for businesses that want:

• Fixed monthly costs
• Off-balance-sheet accounting
• No resale risk

2. Finance Lease or Hire Purchase
You retain ownership (or equivalent), but spread the cost often with tax advantages over paying cash upfront.

3. Salary Sacrifice for EVs
An increasingly popular alternative. Employees get brand new EVs with tax savings, and your business avoids capital outlay altogether.

When Might Cash Make Sense?

• You’re cash-rich and looking for long-term asset ownership
• You’re buying specialist or heavily customised vehicles
• You want to avoid finance or lease obligations completely
• You're purchasing a very small number of vehicles

Even then, it's worth comparing the total cost of ownership (TCO) across all funding methods.

Our Advice

Buying with cash may feel “cleaner,” but it isn’t always smarter. Every business is different and so is every fleet.

LetsTalk Fleet offers independent funding reviews to help you choose the most efficient model for your goals, cash flow, and tax strategy.

Get in touch to run the numbers and see how your funding strategy stacks up.

How Important Is Certainty in Managing Your Fleet Budget?

In a world of fluctuating fuel prices, evolving tax rules, and rising vehicle costs, one thing matters more than ever: budget certainty.

For many organisations, fleet costs are a top-three operational expense — and unpredictable variations can quickly affect profit margins, planning, and cash flow. That’s why fleet budget control is no longer optional — it’s essential.

📊 What Drives Budget Uncertainty in Fleet Management?

1. Variable Fuel Costs
   Even with a move to EVs, energy prices can fluctuate. Fuel cards or charging arrangements help, but volatility remains a concern.
2. Maintenance and Downtime
   Unexpected repairs or poor vehicle utilisation can destroy forecasting accuracy and push costs higher.
3. Mileage Variance
   High-mileage drivers using grey fleet or own-vehicle reimbursement schemes can cause uncontrolled spending spikes.
4. Contract Ambiguity
   Leases with mileage penalties or unclear maintenance responsibilities often lead to end-of-term cost surprises.
5. Legislation & Tax Changes
   From VED changes to BiK adjustments, fleet-related taxes and incentives shift frequently — creating planning uncertainty.

✅ How to Build Budget Certainty

1. Fixed-Price Fleet Leasing

Contract hire with maintenance included gives you known monthly costs, covering everything from vehicle supply to servicing and tyres.

2. Salary Sacrifice for EVs

These schemes offer ultra-low Benefit-in-Kind tax and predictable deductions for both employer and employee — without needing to own the asset.

3. Data-Driven Planning

Use telematics and mileage tracking tools to monitor usage and adjust policies proactively.

4. Policy Alignment

Ensure your fleet policy supports cost predictability, with clear rules on eligibility, mileage caps, and vehicle choice.

💬 Why It Matters

Without budget certainty:

• It’s harder to manage cash flow
• Departmental planning becomes reactive, not strategic
• Finance teams struggle to forecast and set realistic mobility budgets
• Cost creep goes unnoticed until it’s too late

With the right approach, you can lock in pricing, reduce variance, and forecast with confidence.

🤝 Let’s Talk Fleet Budget Confidence

At Let’s Talk Fleet, we help organisations remove budget guesswork by designing tailored vehicle funding and cost control strategies. Whether you operate a company car policy, grey fleet, or salary sacrifice scheme, we can help you:

• Compare funding models
• Introduce cost-stable solutions
• Align your fleet policy with your business objectives

📞 Take Control of Your Fleet Budget Today

Get in touch for a no-obligation review and start driving better financial predictability.

👉 Talk to us