If you are a company owner in the Netherlands, whether this is ZZP or any other legal form, you might be considering owning or leasing a company car or another vehicle.
Business vs personal lease
There are generally two types of car leasing in the Netherlands: private lease, for personal use, and business lease, for use in relation to a business. This guide is about business leasing. For private lease (i.e. non-business car leasing) see this guide to leasing a car in the Netherlands.
Buying vs. Leasing a Company Car in the Netherlands
When you have ample capital at your disposal, buying a company car outright may seem like the logical choice. This is a one-off investment that offers a number of tax advantages, such as allowing you to put the car on your balance sheet and benefit from annual depreciation. You also become a full owner of the car right away – both legally and economically.
But what if you don’t have the funds upfront to purchase a car or don’t want to take a loan? In that case, company car leasing, also known as “zakelijk leasing”, may be an option for you. This option presents a range of advantages, one of the most prominent being the ability to enjoy a new and reliable vehicle without the burdensome costs of ownership.
Understanding the Types of Business Leasing
In the Dutch market, you’ll encounter three primary types of business car leasing:
- Financial Lease (Financiële Lease),
- Operational Lease,
- Carefree / Full-Service Leasing (Full Operational Leasing).
Let’s take a closer look at them:
Financial Lease (Financiële Lease)
Financial lease is a hire-to-purchase arrangement, making you the owner of the car after completing the hire-purchase contract. This means that you pay back the lease company in installments and bear the economic risks like obsolescence and depreciation. However, at the end of the contract, you are the owner of the car, which allows you to resell.
Pros of Financial Lease:
- The car becomes yours once fully paid.
- The car appears on the balance sheet, allowing you to write it off.
- You might be entitled to an investment deduction. However, this only applies to commercial vehicles and vans and not to passenger cars.
- Down payments are possible, reducing monthly costs during the lease term.
Cons of Financial Lease:
- Early contract termination may not be possible in most cases.
Unlike financial leasing, the operational lease doesn’t make you the owner of the car. It functions more like a long-term rental, relieving you of the economic risk and depreciation. While the operational lease might seem disadvantageous because you miss out on tax benefits, you can opt for a lease term shorter than the economic or fiscal life of the vehicle to mitigate this.
Pros of Operational Lease:
- Flexibility in contract termination, depending on the lease agreement.
- Residual value inclusion in the lease term. The higher the residual value, the lower the lease term.
- Options to continue renting the car at a pre-agreed price, buy it at the (estimated) residual value or return it after the contract ends.
Cons of Operational Lease:
- No tax benefits due to the car not appearing on the balance sheet.
- Interest rates might be higher compared to financial leasing or bank loans.
Carefree/Full-Service Leasing (also known as Full Operational Lease):
This option, well-known in the individual consumer market, promises a hassle-free experience. The leasing company retains ownership of the car, and all associated costs, such as taxes, insurance, and repairs, are included in the monthly lease rate. You only pay for fuel or charging.
Pros of Full-Service Leasing:
- Hassle-free management and financing as the leasing company handles everything for you.
- Leveraging the purchasing power of the leasing company.
- No impact on your company’s working capital.
Cons of Full-Service Leasing:
- This is the most expensive option among the three.
- No depreciation benefits as the car is not on the balance sheet.
- Early contract termination may not be possible in most cases.
An example of a Full-Service lease option can be an offer by JustLease:
|JustLease – core features|
|Vehicle Selection||A very diverse range of brands and models, including Mercedes-Benz C-Class Limousine, Porsche Panamera, Tesla Model Y ‘Long Range’, Tesla Model 3, Mazda CX-60 Homura, Kia Niro EV Edition, and many more.|
|Contract Length||Variety of contracts offered – from 6 up to 72-month leasing terms.|
|Cars for all budgets||Monthly rates ranging from €250 to €2000 + BTW (VAT).|
|Customer Satisfaction||Highly rated by consumers with a rating of 9.0 based on 1267 reviews.|
|Client Service||Available Monday-Friday 8:00 to 21:00. Website only in Dutch. App allowing to manage multiple aspects of your contract and services.|
|Insurance||All risk insured.|
|Lease Options & Services||Full Operational Leasing. Tires, insurance, road tax and roadside assistance in all countries on the green card are included in the monthly fee.|
Leasing a Car in the Netherlands as an Expat ZZP’er
Here comes the good news, as a self-employed individual in the Netherlands (ZZP), both private and business lease options are available to you.
Private Use of Business Lease Car
Business lease offers tax benefits over private lease, such as deductible VAT and cost write-offs from your profit. However, if you drive more than 500 private kilometers in a year, you’ll have to pay an ‘addition’. This can be mitigated by maintaining a good trip registration.
Pros of Business Lease for ZZPer:
- Tax benefits due to deductible VAT and cost write-offs.
- Reduced income tax payments.
- Lower addition rate for electric cars.
Cons of Business Lease for ZZPer:
- Addition payment for exceeding private mileage.
- BKR registration through the lease contract.
Private Lease for Business Purposes as ZZP’ers
The private lease eliminates the need for dealing with additions and trip registrations. You can declare €0.21 per kilometer for business trips, which is deductible from your profit. However, other costs are not deductible, and a BKR registration will be associated with the private lease contract.
Pros of Private Lease for Business Use:
- No additions or trip registration is needed.
- Kilometer deduction for business trips.
Cons of Private Lease for Business Use:
- Other costs are not deductible.
- BKR registration.
If you would like to go ahead with the private lease you will see there is plenty of options for you to choose from.
|ANWB Lease||– Established reputation with years of experience,|
– Roadside assistance in Europe; and money back if you already have roadside assistance,
– Flexible kilometer bundle,
– Can be canceled in the event of personal circumstances, such as job loss.
|GoDrive.nu||– Website in both Dutch and English,|
– Monthly subscription model,
– Monthly price range €349-599,
– One-off registration fee of €249.
|XLEasy||– English language introductory website,|
– Roadside assistance,
– All-risk insurance included with €500 deductible for non-recoverable damage,
– Replacement of tires included,
– Customer satisfaction rating of 9.0 based on 1267 reviews
|JustLease||– On the market since 2012,|
– Personalized car and contract,
– Flexibility with an app: you set your mileage, ‘upgrade’ the car or cancel your contract,
– Collection and delivery service for maintenance,
– Customer satisfaction rating of 9.0 based on 1267 reviews.
|IkRij.nl||– Option to sell your current car,|
– One point of contact,
– Fixed and transparent monthly rate,
– Insurance included as a standard,
– Customer satisfaction rating of 8.5 based on 1683 reviews.
Lease Takeover in the Netherlands
If you find yourself needing to exit a lease earlier than planned or seeking a shorter lease, you can consider lease takeover platforms like leaseovernemen.nl. This marketplace connects entrepreneurs and leasing companies, offering lease contracts for used cars, and allows you to take over someone else’s lease with shorter terms and favorable rates.
How does Leaseovernemen.nl works?
The process on leaseovernemen.nl is rather simple: you go to leaseovernemen.nl and browse the currently available cars. If there’s anything that interests you, you can contact the provider (entrepreneur) directly. Once you’ve agreed on the details, the provider will initiate the takeover of the contract with their lease company and handle the takeover with you. The idea is to create a win-win situation: the initial owner gets out of their lease early, and you get a deal on a car without having to commit to a long-term lease.
If you’re the one looking to get out of your lease early, then leaseovernemen.nl offers the option for you to list your car for €19,95. However, keep in mind, that there may not be someone interested in taking over your lease, and the legal and financial responsibilities will stay with you for the duration of the lease contract.
What is important to consider when choosing a leasing company?
When it comes to leasing, like everything in life, some providers are better than others. As you embark on your search for the ideal leasing option, consider opting for a reputable firm with a long-standing history in the industry, offering a diverse range of available vehicles. Keep an eye out for leasing arrangements that provide flexibility, such as adaptable contract lengths and assistance with maintenance and repair services. You want also to compare monthly rates from different leasing firms, taking into account any additional costs for insurance, maintenance, and BTW.
Did you know?
Did you know that in the Netherlands electric company cars are eligible for various incentives and tax benefits? As you have already read here, if you have a company car and use it privately for over 500 km per year, you are subject to a taxable income rate. However, in 2023, the addition for electric cars will be lower than that for petrol cars to support eco-conscious choices of consumers.
Please note that this information is provided for general knowledge and should not be considered as financial or legal advice. Always consult with a professional service provider and carefully review their terms and conditions to determine the best leasing options for your specific needs.