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Merc SLK 250 DIESEL - Lease - hoyak

Hi,

I am looking at leasing my next car as would like to change more often.

I have seen many cheap deals for the above car. In the region of £200-£250pm on a 24mth deal 10k miles pa. Other leases for the same price are things like Leons and Astras.

How is this possible? Is there anything I should watch out for?

This seems like an amazing deal I earn about £30k a year and could never afford to buy something like this. Any advice/comments appreciated

Merc SLK 250 DIESEL - Lease - leaseman

You can have any car you desire on a lease at £200 a month. But the initial rental required to achieve this could be astronomic. Or there could be draconian conditions attached to the deal. Or both!

Before deciding to go ahead with such a contract, you need to know everything about the contractual rentals, terms and conditions etc. and ask for a draft copy of the agreement first. Then ask someone that knows about leasing to check it through before you commit to anything.

Having said that, there have been some very cheap deals available on CLK, but I'm not sure that they are still available. The last one we took an order for was in December. It will soon be delivered to our client and is a 250 CDi BlueEfficiency AMG Sport Auto in solid paint. Retail value of the car is £36,000. Initial rental is £1, 660 and that is followed by 23 monthly rentals of £230. These rentals are subject to VAT at 20% and cover a total of 20,000 miles on a genuine non-maintained contract hire for 24 months. The client is responsible for servicing the car at a Mercedes dealership, although this will only amount to 1 or 2 services. If the car is not serviced by a Mercedes dealer, in line with the service schedule, there is a large penalty imposed at the end of the contract. Similarly, the car must be returned at the end of the contract in good condition, complying to normal fair wear and tear standards.

Hope this helps, and for anyone else considering leasing a car: Caveat Emptor.

Merc SLK 250 DIESEL - Lease - barney100
If you are self employed how much of the lease and servicing cost can be put against tax, I suspect it is not straight forward.

Merc SLK 250 DIESEL - Lease - Collos25

Residual value also comes into play so does VAT and claiming it back.

Merc SLK 250 DIESEL - Lease - leaseman

To fully comment on your posting Collos25, the residual value within a contract hire or "operating lease" will only affect the leasing company. I would advise anyone entering into a finance lease or a lease purchase (this later instrument being a glorified HP agreement and nothing remotely to do with a lease) to consider what terminal (or baloon) payment will be due. It is not a financial instrument that should be considered by the faint hearted unless accompanied by a guaranteed residual value given by the financing company and definitely not by a third party.

For the VAT position, see my next post below.

Edited by leaseman on 13/01/2013 at 10:45

Merc SLK 250 DIESEL - Lease - leaseman
If you are self employed how much of the lease and servicing cost can be put against tax, I suspect it is not straight forward.

Hi Barney 100. A self employed person will usually have an agreement with the taxman as to how much of the use of the car is for pure business purposes and how much for private motoring. This will obviously depend on the nature of your work, but the business element can be anywhere between 10% and 90% I guess.

This same percentage of the total costs of running the car, including the lease rentals, fuel etc. can be claimed as a business expense.

The VAT position is somewhat clearer. Each rental is split into 2 components if it is a fully maintained lease. The VAT on all the service element of the rentals and 50% of the VAT on the finance element is deemed to be reclaimable. If the lease is non-maintained, then the service element will be either zero or a very small value, depending on the leasing companies accounting methods. Therefore, only 50/% of the VAT is deemed to be reclaimable on the rentals.

This position can be affected, as is the case of all output VAT, in the case of professions where supplies are exempt or zero rated, but if that affects you, you will be aware of the rules.

Edited by leaseman on 13/01/2013 at 10:47

Merc SLK 250 DIESEL - Lease - hoyak

Hi,

Thanks for all responses so far. I am flexible with my initial payment and would look to increase that to get the monthly cost down. Need to do a bit of research as would prefer something a little bigger and perhaps a little less girly. I am a 20 year working in a large corporation don't want the p*** ripped out of me.

C Class Couple/Audi A5 Coupe seem a lot more expensive... not sure why when these cars are similar prices? Any ideas?

Merc SLK 250 DIESEL - Lease - Collos25

Very well put,

But is it not true as in Germany the lease company can also claim back the VAT on the vehicles, companies such as Hertz and Sixt make most of their money selling ex rental and lease cars than they do through the actual rental or lease it being only an instrument to get round paying the car tax and vat. a two year old mercedes coupe will hold its value as a percentage better than a run of the mill people tin box.

Merc SLK 250 DIESEL - Lease - hoyak

Very well put,

But is it not true as in Germany the lease company can also claim back the VAT on the vehicles, companies such as Hertz and Sixt make most of their money selling ex rental and lease cars than they do through the actual rental or lease it being only an instrument to get round paying the car tax and vat. a two year old mercedes coupe will hold its value as a percentage better than a run of the mill people tin box.

Soas the SLK holds its value better they can lease it for less than the C Class/A5.. makes sense I guess. I thought Mercs suffered high depreciation to be honest so would expect an Audi to be cheaper?

Merc SLK 250 DIESEL - Lease - leaseman

Collos25, it is a european standard that leasing companies can reclaim the VAT on cars purchased to lease to a lessee. But they must account for VAT on the full sale price of the car on disposal. Hence the depreciation is always ex-VAT and so their rentals are based on this value. This makes leasing a very cost-effective financing method.

The lease rental is largely based on the depreciation, but a 30% discount on the purchase price has a much larger affect than a 30% premium on the residual value, especially if that residual value is based on a high terminal mileage. So, Hoyak, it's all a matter of timing. If you had been trawling the market in October, you would have found a number of C Class Mercedes at very cheap rentals, as there was a glut of them on the market. Not so now!

Audi achieved their 2012 sales target well before the turn of the year, and they had done an excellent job in predicting demand across their range. Hence there has not been any bargains available from that marque since the run-out of the old model A3. Timing, and speed of commitment, is the essence for the bargain-hunter. (We've just ordered an E Class, but don't ask....there were only about 20 in the country, and they've all gone as well.).

Merc SLK 250 DIESEL - Lease - Happy Blue!
Is it generally the case that lease deals which seem very cheap are because the manufacturer needs to dispose of unsold stock and this the most cost effective way to do it?
Merc SLK 250 DIESEL - Lease - leaseman

Hi HappyBlue. Basic answer is No. replace the word "seem" in your posting by the word "are" and the opposite is generally correct. There are too many "lease deals" on offer which are not what they seem. My advice is only deal with a leasing company or broker who is a member of the BVRLA, (British Vehicle Rental and Leasing Association) whereby you have, at least, an industry body that will intervene in any disputes.

Merc SLK 250 DIESEL - Lease - Happy Blue!

Thanks

Presumably a broker who then gets us a car via Lex Autolease is all pukka?

Merc SLK 250 DIESEL - Lease - leaseman

Lex Autolease are a highly respected principal lessor who are selective with regard to the brokers that they appoint. So it is very likely that the deal is genuine. Again, the order form that you will be asked to sign should spell out all the terms of the lease, and when you receive the actual leasing agreement to sign, ensure that it mirrors the terms which you have agreed. Additionally, as Lex are, generally, extremely competitive with full maintenance costings, I would advise taking this option, irrespective of your mileage, so long as the maintenance is handled by Lex and not a third party maintenance company.. Make sure that your projected mileage, within the contract, is an accurate reflection of your future motoring needs as the Excess Mileage charge may be on the heavy side.

Merc SLK 250 DIESEL - Lease - Happy Blue!

Thanks - that really helpful.

if you fancy quoting for some business please ask the mods to send me your e-mail address.

Edited by Happy Blue! on 14/01/2013 at 08:54

Merc SLK 250 DIESEL - Lease - Collos25

Lex is owned by Lloyds bank ie the people.

Merc SLK 250 DIESEL - Lease - Canon Fodder

OP - look at www.contracthireandleasing for a good range of options.

I've been leasing for 12 years - there are no 'catches' but be aware that you need to service the car and also hand it back free from damage.

Good deals become available now and again on certain models and it's these you should look out for. That Merc deal is a cracker and is certainly genuine, although it's only the 7-speed auto which is not my cup of tea

Merc SLK 250 DIESEL - Lease - Happy Blue!

Yes - Ihave used that website and it has been very useful in sourcing possibly two cars for us.

 

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