Car Lease vs Buy

For short-term (3 years), leasing often has lower monthly payments. For long-term (5+ years), buying is usually cheaper. Irish VRT makes new cars expensive, which affects both options similarly. Use this calculator with your specific numbers to compare.

VRT (Vehicle Registration Tax) is included in the purchase price and factored into lease payments. For used cars, VRT has already been paid. VRT can add 14-36% to the cost of a new car, which is why leasing a new car in Ireland can be expensive.

Leasing has mileage limits (typically 15,000-30,000 km/yr), excess wear charges, and early termination fees. You also pay VRT indirectly through the lease. Gap insurance is recommended but adds to the total cost of leasing.

EVs benefit from lower VRT (up to €5,000 relief) and reduced motor tax. Salary sacrifice through the BIK regime makes EV salary-sacrifice leasing very tax-efficient. Leasing an EV can be attractive due to zero VRT on EVs under €50,000.

Irish cars depreciate 15-20% per year. A €30,000 car is worth about €15,000 after 5 years. EVs depreciate faster at 20-25% per year. Depreciation is often the biggest single cost of car ownership in Ireland.

Enter the car price, deposit, loan rate, monthly lease cost, and running costs. The calculator shows total 3-year and 5-year costs for both options. Lower total cost indicates the better financial choice for your situation.

PCP has lower monthly payments but a large balloon payment at the end. HP has higher payments but you own the car from the start. PCP is better if you change cars every 3 years; HP is better if you plan to keep the car long-term.

Yes, especially at month-end or for end-of-line models. Compare multiple dealers, consider different mileage allowances, and ask about manufacturer contributions. The advertised rate is rarely the final price.

Motor tax is the same regardless of ownership. It depends on CO2 emissions and engine size. For a typical family car with 140g/km CO2, annual tax is around €570. EVs pay just €120 per year.

You return the car and can start a new lease. If the car is worth more than the residual, you have no equity. If less, you are not liable for the difference (unlike PCP where you may have negative equity).

Leased cars require fully comprehensive insurance. The leasing company is named as an interested party. Gap insurance is recommended to cover the difference between insurance payout and outstanding lease balance.

EV VRT relief of up to €5,000 reduces the upfront cost. This benefit applies whether you lease or buy. Over 5 years, buying an EV is typically cheaper than leasing in Ireland, especially with the lower running costs.