Buying a Van for Your Business: Tax & Finance Tips 🚚
- John Massey
- Jan 17
- 2 min read
Updated: Oct 7
Buying a van or work vehicle for your business? Here’s how to get the best value, choose the right finance option, and maximise your tax relief — whether you’re a sole trader or limited company.

How to get the best value for money when buying a van
The best deals usually depend on how you pay for the vehicle. Here’s how each option compares:
✅ Cash / outright purchase – usually offers the best overall value.
💳 Third-party finance (bank loan) – still good value, with flexible repayment terms.
🚗 Hire Purchase (via dealer) – spreads cost but you’ll pay interest.
⚠️ Leasing – Least preferrable - usually carrying the highest cost over its lifetime!
How to maximise tax relief
In this guide we're talking about vans used for business only (not personally). Cars with mixed use have different rules.
All of the above methods of purchase will allow you to set the full cost of the van against your profits. The difference is in timing.
Purchasing via cash, loan or Hire Purchase (options 1 - 3) means that the business can claim Annual Investment Allowance and offset the whole purchase price against taxable profits in the year of purchase (even if repayments are spread over several years). This is usually considered preferable.
Leasing a vehicle (option 4) means that tax relief is spread throughout the lease agreement - usually several years.
Get the paperwork right
For sole traders and partnerships, the vehicle can be purchased in the proprietor’s or partners’ names. For limited companies, make sure all documents are in the company’s name (not the director’s), including:
Purchase invoice
Loan / Hire Purchase or lease agreement and accompanying Direct Debit agreement
V5C (vehicle log book)
Insurance agreements
Final Thoughts
Buying a vehicle is a big investment. With the right finance option and tax planning, you can save money and keep your records compliant.
👉 Before you commit reach out for tailored advice.
If you found this helpful, please share it.
For regular tax tips 👉 connect with me on LinkedIn and explore my related posts 👇
Need an advisor? Feel free to reach out.