Car finance

badaz52

Hi,

I am going into the last year of my personal finance lease with Peugeot on the 1st September so am making some enquiries to trade in early as my warranty expires and I'll have to run with no warranty in the last year or buy an extended one which I don't really want to do. I'm not sure why the warranty doesn't cover the entire lease but thats a different story.

What I am asking is with regards to VAT, I have requested a settlement figure from the finance company which the dealer would need to clear to take the car from me, I cannot settle it myself and keep as this is not an option.

What I want to know is there were two settlement figures, one with VAT and one without. If I trade in do the dealer's pay this VAT or not? or do they just get it back on the sell on later? If they don't pay the VAT it probably puts me in a better position than I thought but I'm not sure.

foxy-stoat

VAT is payable by the dealer, they just need to know how much the VAT element is on the value when you trade it in or settle - it becomes a secondhand car rather than a new car.

Why would you need to chop it in early just because the warranty has run out? You will be losing out when you part exchange it for another new vehicle which you will be taking out a PCP on anyway.

badaz52

foxy-stoat wrote: »

VAT is payable by the dealer, they just need to know how much the VAT element is on the value when you trade it in or settle - it becomes a secondhand car rather than a new car.

Why would you need to chop it in early just because the warranty has run out? You will be losing out when you part exchange it for another new vehicle which you will be taking out a PCP on anyway.

Just worried about running it with no warranty in case of expensive repairs and I'm not sure yet how much the extended one will be as they haven't sent me a reminder yet.

alan_d

The car doesn't know the warranty has run out - it won't suddenly start having loads of issues now it's run out.
I currently run 3 cars without any warranty - I just fix stuff as needed. I've done this for over 25 years, not had a bill big enough to justify a new car under warranty yet.
I also run cars with high mileage - scary stuff for many

DrEskimo

alan_d wrote: »

The car doesn't know the warranty has run out - it won't suddenly start having loads of issues now it's run out.
I currently run 3 cars without any warranty - I just fix stuff as needed. I've done this for over 25 years, not had a bill big enough to justify a new car under warranty yet.
I also run cars with high mileage - scary stuff for many

It's a logic that's always confused me personally...

I am worried about unexpected bills of £1,000 a year, that may be more, but more than likely will be substantially less, so I'll get a new car were I am absolutely guaranteed to pay higher depreciation to the tune of around £2/3k a year...