Bidvest offers car loans for individuals who wish to own a car. The loans are obtained cheaply and within a short time.
Vehicle Finance Options
Car finance options differ in terms of tax treatment and the ownership of the vehicle.
| Instalment Sale Agreement | Finance Lease Agreement | Operating Rental | |
| FINANCE PERIOD | Allows you to finance the vehicle over a period of up to 72 months. | Allows you to finance the vehicle over a period of up to 72 months. | Allows you to lease the vehicle over a specified period up to 60 months, depending on monthly distance travelled. |
| Ownership | Ownership automatically passes on receipt of final payment. | Ownership automatically passes on receipt of final payment. | Possible. |
| Benefits | Monthly repayments can be reduced by structuring in a balloon payment*. | Monthly repayments can be reduced by structuring in a balloon payment*. | Constitutes the lowest cash outflow. More car for your money. |
| Best Suited For | Those who want a longer finance period and/or would like ownership of the vehicle. | Those who are paying a deposit or including a balloon payment as part of the payment plan. Particularly useful if you finance for less than 60 months. | Those who would like the use of a car, much like a long-term rental, without having to own it. |
| Tax Treatment (for individuals who receive a travel allowance) | |||
| SARS allows for the deduction of finance charges and wear and tear at 20% per annum against travel allowance income. ** | SARS allows for the deduction of the monthly payment (including balloon payment) against travel allowance income. ** | SARS allows for the deduction of the monthly rental (including balloon payment) against travel allowance income. ** | |
*A balloon payment is a large, lump-sum payment scheduled at the end of a series of smaller periodic payments that pays the loan in full. This is possible if your credit rating allows.
** Applicable to travel allowance receivers and business’ only.
Car Scheme Options – General Guide
- Company Car – preferable when business kilometres are less than 50% of the total kilometres travelled
- Travel Allowance – preferable when business kilometres are more than 50% of the total kilometres travelled.
Tax Treatment Methods
As a travel allowance receiver, you have a choice of two methods of claiming a tax deduction. With both methods, a log book must be kept with business travel records for the year of assessment.
- Actual Cost Method
When using the ‘actual cost’ calculation, a log book with accurate details of all the actual costs of travelling must be kept. Records must reflect fuel and running expenses, odometer readings, business kilometres, and purpose of each of the business trips.
- Gazetted Cost Method
With this method, also known as ‘deemed cost’, you calculate your distances travelled for business using the gazetted tables and applying rules and rates per kilometre as set by the Minister of Finance. A deduction is claimed based on the annual gazetted rates per kilometre in respect of fixed running costs depending on the cost of the vehicle. Fixed costs also cover depreciation, interest, insurance, licence and registration fees.
Vehicle Finance Additional Services
As one of the leading vehicle and asset finance companies in South Africa, finance is not the only service we offer. Apart from helping you source your vehicle at the very best prices, when the time comes, we’ll also help you sell your car for the best price.
Options include:
- Maintenance Plans
- End of Contract Sales
- Vehicle Hire
- Roadside Assistance
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| Maintenance Plans | End of Contract sales | Vehicle Hire | Roadside Assistance | |
| What it is | A maintenance premium (paid monthly or single upfront) covers the cost of all services and repairs that may be required. | You have the option to resell your vehicle through our online auction system at the end of the contract. | Offers you a temporary car while your own is being serviced or repaired. | Club McCarthy 24-hour roadside assistance. |
| Main benefit | No unforeseen repair bills. | Achieve maximum resale price. | Preferential rates for Budget Car hire for Club McCarthy members. | Automatic free one year membership if you buy your vehicle at a McCarthy dealership. |
| Who it is for | Individuals who wish to have peace of mind regarding maintenance costs. | Individuals who opted to take ownership of the vehicle and would like to sell it. | Individuals whose vehicles are temporarily unavailable for use. | Any car owner. |