# 15.12, Should I get a van? Buying, leasing and the real costs
The van is one of your biggest early decisions, and one of the easiest ways to accidentally chain yourself to a monthly payment you can't really afford.
1. The rule of thumb
By the time you add insurance, finance and fuel, a "cheap" used van can easily swallow £350–£600 a month: before you've put diesel in it. Get the numbers down on paper before you sign anything.
2. What a used tradie van actually costs right now
The Ford Transit Custom is the benchmark. Here's what the UK market looks like in 2025–26:
| Van type | Age / mileage | Typical price range | Notes |
|---|---|---|---|
| Older workhorse | 8–12 years, 100k–160k+ miles | ~£6,000–£9,000 | Still common for one-person trades starting out |
| Mid-age decent van | 3–6 years, 60k–120k miles | ~£10,000–£16,000 | Sweet spot for most self-employed trades |
| Nearly new | 0–3 years, low miles | £20,000+ | Usually via dealer finance or lease, not a cash buy |
Listings for 2015–2021 Transit Customs with 80–140k miles sit mostly in the £6,000–£15,000 + VAT range depending on age, spec and condition.
For a starter self-employed tradie, you're realistically looking at the first two rows. The nearly-new bracket is where people get into trouble with finance before they've got the work to justify it.
3. Insurance: the bit nobody sees coming
Van cover hits young tradespeople hard, especially under 25.
| Age band | Typical annual premium | Monthly equivalent |
|---|---|---|
| 17–20 | ~£3,905 average | ~£325/month |
| 21–25 | ~£1,748 average | ~£145/month |
| 25+ (for contrast) | Often £700–£1,400 | ~£60–£120/month |
A year of no-claims can drop that from ~£3,610 to ~£2,354, but it still stings.
If you're under 25, budget roughly £140–£250 a month for proper business-use van cover. That's just to be legal, before fuel and finance.
Tip for new starters: Don't assume your car insurance no-claims transfers to a van policy, most insurers won't allow it. You're starting from scratch. Get quotes before you commit to a van, not after.
4. Buy vs lease vs finance: what it actually costs per month
All three are common. Here's the honest comparison for a one-person trade looking at a medium van worth £10k–£20k:
| Option | Typical deal | Rough monthly cost | What you end up with | Main risks |
|---|---|---|---|---|
| Buy used (cash) | £8k–£12k older van | One-off lump sum | Van owned outright from day one | Big cash hit; older van = repair risk |
| Buy used (loan) | £10k bank loan over 5 years | ~£200–£230/month | Van owned once loan is cleared | Fixed payment, plus repairs on an older van |
| HP / dealer finance | £15k–£20k newer van over 4–5 years | ~£250–£400/month | Van owned at end of term | High fixed cost; risk if work dries up |
| Lease (contract hire) | New/nearly new van, 3–5 year term | ~£250–£400 + VAT/month | Nothing, you hand it back | Mileage limits; tied in; no asset at the end |
Buying used (cash or bank loan)
If you can pay cash, it's a one-off hit and then just running costs. A £10,000 bank loan over 5 years at typical rates is roughly £200–£230 a month.
Pros: Van is yours outright at the end. A couple of years with no payments if you look after it. Cons: Bigger up-front commitment. Older van means more repair risk, and you carry that.
Leasing (contract hire / business lease)
A modest new or nearly new medium van on a business lease is often advertised around £250–£400 a month + VAT, depending on mileage, term and deposit.
Pros: Newer van, warranty, usually fewer surprise repairs. Predictable monthly cost. Cons: You don't own it. Contracts can be restrictive on mileage and damage. Harder to flex down if your work dries up, you're locked in.
HP / dealer finance
Small deposit plus 3–5 years of £250–£400 a month. The finance agreement is secured on the van, miss payments and you can lose it.
Pros: You own it at the end of the term. Easier to get into a better van early on. Cons: Fixed payment every month, whatever the work is doing. Total cost over the term is higher than paying cash.
The honest version: there's no magic option. Buying used and cheap is lowest risk but highest hassle. Leasing is predictable but you never own it. Finance gets you into a nicer van but ties you to payments whether the phone's ringing or not.
5. Tax treatment: buying vs leasing
Van tax is one of the few nice things HMRC gives you as a small trader.
| Cost type | How it's treated (sole trader) | What it means in practice |
|---|---|---|
| Buy van outright / HP | Van counts as plant and machinery. You can usually claim 100% of the cost in year 1 using Annual Investment Allowance (AIA). | A £10k van can knock £10k off your taxable profit in year 1 (business-use proportion only). |
| Finance interest on HP / loan | Interest element is a deductible expense. | You claim interest each year on top of capital allowances. |
| Lease / rental payments | Treated like rent, fully deductible as a revenue expense if the van is for business use. | No big first-year hit; you claim the lease cost each year as you go. |
| Running costs (fuel, repairs, insurance, tax, etc.) | All allowable as revenue expenses for the business-use share only. | You claim these every year regardless of buy or lease. |
The key difference:
- Buying a van when you've got a decent profit can slash your tax bill that year via the Annual Investment Allowance · 100% of the cost written off in year one.
- Leasing smooths the tax relief over time but doesn't give you that big first-year deduction.
Either way, you only claim the business-use portion. If you use the van 80% for work and 20% personal, you claim 80% of everything.
If you run it through a limited company and use it privately, there are separate benefit-in-kind rules, but for most one-man bands using it mainly for work, it stays relatively simple.
6. Running costs people underestimate
Every experienced tradie will tell you: the van costs more than you think. Here's what gets missed or low-balled:
Repairs and maintenance
Tyres, brakes, servicing, unexpected faults, MOT fails. A couple of big repairs a year can easily be £800–£1,500 combined on an older van. Budget for it or get caught out.
Fuel
Even modest mileage adds up. 15,000 miles a year at 35mpg and current diesel prices runs into thousands, not hundreds. People budget "£50 here and there" and ignore the annual total.
Insurance extras
Breakdown cover, legal protection, courtesy van cover. Young drivers may pay more again for decent cover on top of the basic premium.
Parking, tolls and clean air zones
City work in particular can mean regular charges. London's ULEZ, Birmingham's CAZ, and others, if your van isn't compliant, you're paying daily charges or facing fines.
Signwriting and security
Decent signwriting, slam locks, deadlocks, tool safes and trackers all cost money up front. But tool and van theft is rampant enough that insurers and trade bodies keep shouting about it. See Guide 12.1: Tool theft.
Downtime when the van is off the road
If the van is essential to your work and it's in the garage for a week, you're either hiring at short notice or losing jobs. Neither is cheap.
7. The costs checklist
Before you sign anything, make sure you've accounted for all of these:
- Finance or lease payment
- Insurance (business use, not just social/domestic)
- Road tax
- Fuel (work out your likely annual mileage, not a guess)
- Servicing and MOT
- Tyres and brakes (at least once a year on a working van)
- Repair fund (£500–£1,000 a year set aside for an older van)
- Breakdown cover
- Parking, tolls, congestion/clean air zone charges
- Security · extra locks, deadlocks, tool safes, trackers
- Signwriting or basic branding
- Hire van costs if yours is off the road
A van isn't a one-off purchase: it's a monthly subscription. Treat it like one when you're working out your prices.
8. So should you get one straight away?
Not necessarily. Ask yourself:
- Can you do your first jobs from a car or an estate? Plenty of sparkies, plumbers and decorators start with a decent car and a roof rack or trailer. It's not forever · just until you know the work is steady.
- Can you afford the all-in monthly cost without regular work? If the answer is "only if I'm busy every week" · you're one quiet month away from stress.
- Could you borrow a van or share for the first few months? Some trades start by using a mate's van on weekends or hiring one for bigger jobs. Not ideal, but it buys you time.
The line: Get a van when you've got enough steady work to justify the monthly cost, not before. A van sitting on the drive costing you £400 a month while you're waiting for the phone to ring is dead money.
What to do next
- Read: 15.11 · Tools of the trade: what to buy first and what can wait
- Read: 15.6 · The money reality: what you'll actually earn and spend in year one
- Read: 5.3 · What expenses can you claim as a self-employed tradesperson?
- Read: 6.1 · Public liability insurance: what it is and why you need it
- Read: 12.1 · Tool theft: how it happens, how to prevent it, what to do when it does
- Download: Cashflow forecast · 12 week template (plug your van costs in and see if it works)
Sources (UK)
- Used van market data (2025–26) · Ford Transit Custom listings, median pricing from UK van comparison sites.
- Van insurance comparison data · average premiums by age band for commercial van cover, no-claims discount impact.
- HMRC guidance on capital allowances (AIA) · tax treatment of van purchases and lease payments for sole traders (gov.uk).
- BVRLA leasing guidance · contract hire terms, mileage restrictions, end-of-lease charges.
- Trade insurer reports · van security, tool theft statistics, running cost breakdowns.
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