Its not just down to dead money etc. If its against your business then the way you buy/lease a vehicle has tax implications.
I speak from a commercial vehicle background and things can be a little different on cars as they dont tend to qualify for some of the tax advantages as much as the vans. Here are some basic pointers though.
Hire Purchase
Basically you pay a 10-15% deposit (If you have any sense) + All the VAT if you are VAT registered and buying a van. So you need to cough for a good amount of money to begin with (Again if you have any sense otherwise you are looking at neg equity) You then buy the vehicle over a period and at the end of the term you own it. ATM you get 100% tax allowance on first £50,000 of capital expenditure which means you buy a van for £15,000 + VAT, you put £15k against you tax returns (Ie they may owe you for once). Sounds great but in real terms its just to encourage you to spend atm. The real benefit is that you have a payment history and you have an asset to your business which means you are strengthening your company. It also allows flexibility as you can settle an HP at any time without extra penalties and you can 'cash in' your asset if needs must. Oh and even the interest charged is tax deductable 🙂
Lease Hire/Contract Hire
Contract hire is only lease hire with the servicing and other add-ons ncluded.
This is what it states. You are hiring the vehicle and hand it back within the constraints of the contract. New business usually find it difficult to get accepted on these contracts. They are very tax efficient as the rental (vans) is 100% tax deductable which can mean it being very good way of lowering any tax bills over a spread period and also allow you to have a set vehicle cost over a set period (No surprises). Companies like Stobarts only ever CH as they factor this into their running costs and come up with a cost per mile calculation which lets helps immensly when costing for contracts.
Not gonna go into all the other contracts available like Lease purchase (Just a bit less painfull cash flow wise than Hire Purchase), PCP contracts etc but considering you are a new business and in your position i wouldnt want to hang a big debt around my neck i would be looking at buying a good used van which will still qualify for the tax allowance but wont cripple you. It will still be a good asset to you and your business. Contact me if you want some more finance info or anything on vans (I am a merc main dealer – I may be able to do you a favour in return for some cycle instruction).
The above are basics and you should have an accountant who can give you advice specific to your own business. To say one would suit you is only down to you and your acountant.
Hope the above helps