When you first started out your business, you may have dreamed about the need for a collection of company cars to do business. But you are also likely never imagined you would reach a level of success that would warrant a company car fleet at your disposal. Nevertheless, here you find yourself, a little lost and confused about what to do now. The good news, you don’t have to figure it out all on your own. Here are just a few things that you need to know before operating a company car fleet to make sure that you are covered and protected.
Costs to Maintain
The first thing that you need to know before operating a company car fleet is what it is going to cost you to start and maintain your fleet of cars. Cars may be considered an asset, but they are also quite the liability. Keeping a car running well and smoothly requires a lot of costly maintenance, from gas costs to oil changes, new tires, insurance, etc. It all adds up quickly. Knowing how much operating and maintaining a fleet of company cars will cost you can help you determine if it is really a worthwhile investment for your business.
The next thing that you must consider before operating a company car fleet is what your liability situation looks like. As soon as your company owns a car for business purposes, your business becomes liable for safety and insurance related to that car. Your business will need commercial insurance to cover business vehicles. Business insurance for your car is more expensive than regular coverage because it covers more and tends to be more comprehensive. Make sure that you get insurance figured out for your fleet of company cars to keep your liability as low as possible.
The final thing that you need to know before operating a company car fleet is how your tax situation changes when you have cars. Cars are additional assets that you can claim depreciation on for tax purposes. Knowing how to leverage your spending on company fleet maintenance and accrual can help you get the best tax breaks and credits for your business possible. In some cases, having a fleet of company cars can save you more money in taxes than it costs to maintain.
No matter what the reason, if your company needs to start operating a company car fleet, then you have questions. Luckily, it doesn’t have to be that complicated. Make sure you know these three things before you operate a company car fleet for your business so that you are ready for anything.