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ST - 14- PORT PERRY STAR - Tuesday, March 28, 1995 "Scugog's Community Newspaper of Choice" srg Tune-ups from extra OIL CHANGE Filter & Lubrication HERE'S WHAT WE DO: -Supply and install a top quality oil filter -Install up to 5 litres of SW30 motor oil -Lubricate the chassis PLUS A 10 POINT INSPECTIO *MOST CARS *Most imported vehicle filters extra BONUS *$2.00 extra for Premium TURBO OFFER TESTED Motor Oil Free Brake ¢ CROWN *4x4's, Vans, Trucks, & VICTORIA Mobile Homes Extra. Front End nop (2 hen? ; fhe 29% For nn * MUFFLERS ¢ BRAKE LININGS e SHOCK ABSORBERS Guaranteed for as long as you own your car. MUFFLERS 2127.14 = SHOCKS Inspection There are many advantages to leasing a new automobile by Peter Chaperlin As long as there have been cars, there have been consu- mers who want to own them. That much hasn't changed. The difference today, though, is the means of ownership you choose: buying or leasing. Here's a look at some of the ins and outs in this new era of vehicle ownership: *The initial dollar amount for leasing and financing will be the "capitalized cost" or pur- chase price. The "cap" cost will be a retail price for financing and a wholesale price for leas- ing. Already, the starting point can be different by a few thou- sand dollars. Advantage: leas- ing. *Leasing companies must be prepared to sell the car when you're finished with it. There- fore, in their minds, they "man- ufacture" a used car. As experts in the used car market, they know what options a car must have to be desirable. This means the car will be dressed to please its future sec- Diane Richardson Mobile (905) 404-5254 10 Years Service Why would anyone drive to Uxbridge to visit these two? ond owner. As the driver of a new leased vehicle, you will therefore get more bells and whistles at a comparatively lower cost than the person buy- ing and choosing their own com- bination of options. Advantage: leasing. *You pay GST and PST on the full purchase price when you fi- nance. You pay GST/PST on the lease payment when you lease. Would you rather pay tax on $20,000 once, or on $300 for say 36 months? The former is $3,000, the latter is $1,620. Ad- vantage: leasing. *Closed-end leasing, the nor- mal type at the dealership, plac- es a mileage restriction in the contract. This makes sense, be- cause the dealer is manufactur- ing a used car. It cannot be over- ripe for reselling. If you are oblivious to this, you could be in for a nasty surprise at turn-in time. If you go over the contract limit, you will nay so many cents a kilometre, cost that adds up quickly. For example, a Brian Norrish Home (905) 985-8997 Mobile (905) 433-7351 19 Years Service For Good Deals onevrorer WYN OLDSMOBILE CADILLAC - U GEO X Uxbridge 852-3331 Uxbridge 852-3357 i : We Won't Be U derscid Dundas St. E. Since 1947 Lif Leasing all Makes & Models. Our Customers bring their friends 25800081 Raj) Crossing Warren Rd. 0" [o} 7) x L = » = x 8 I BUICK PONTIAC GMC TRUCKS 1-800-263-2000 1-800-757-2004 10-cent-a-kilometre charge on an extra 10,000 kilometres is $1,000. Advantage: financing. *For those eligible to write off vehicle costs you need to know the nature of the writeoff and how the tax man treats it. If you own and finance the car, only the financing charge (or interest) is eligible to be written off as an expense. The car's purchase price is written off according to Reve- nue Canada's capital cost allow- ance rules. You can write off 30 per cent a year, except for the first year in which only 15 per centis eligible -- that is, the low- est amount. Any car buff will tell you that as soon as a car is driven off the lot, it depreciates more than at any other time. If you lease, the entire lease payment is eligible for a write- off. Advantage: leasing. (The rules are more compli- cated than described above. See an accountant for details). *Now let's look at the num- bers: Joe buys a $25,000 car. Af- ter tax, the capitalized cost is $28, 750. He finances it at 10.75 per cent -- a rate of prime plus four percentage points -- for 48 months. The monthly payment is $740. Jane leases the same car. The capitalized cost is $23,000. She pays the same finance rate of 10.75 per cent over 48 months. The monthly payment is $435, plus $65 tax, or $500. At the end of the four years, here's the situation: Joe owns a four-year-old car worth $9,000. Jane owns nothing, but has an opportunity to buy the car for $9,000 plus tax, or a total of $10,350. If: she doesn't buy, she can lease a new car and the beat goes on. Looking at the cash flow dif- ference (actual money paid out every month), the difference is $240 a month in favor of leas- ing. If Jane took that $240 a 'month and invested it at eight per cent for four years, she would have $13,600. To pur- chase the car costs $10,350. She now has $3,150 more than Joe and they both own a car. Advan- tage: leasing. Does pride of ownership beat extra cash flow? Well, if it does for you, then buy and fi- nance. But for everyone else, remem- ber the old adage: Buy what ap- preciates, rent what depre- ciates. VAN HEMMEN TIRES & SALES 317 HOPKINS STREET WHITBY 666-2121 ISS RZ | VERDRDDRRDDRR! 11]