By Rocky Pretorius, founder and CEO of New Heights Finance · Last updated: 28 September 2026
Business van finance is funding that lets a company buy or use a panel van, light delivery vehicle or bakkie without paying the full price upfront. In South Africa there are three main routes: an instalment sale agreement secured on the van, a lease or rental agreement, or an unsecured business loan used to buy a van outright or cover a deposit. Vans have a tax advantage over passenger cars, because VAT-registered businesses can generally claim input VAT on vehicles built mainly to carry goods, and SARS allows delivery vehicles to be written off over four years.
Key facts
- Main options: instalment sale, lease or rental, or an unsecured business loan.
- Security: instalment sales are secured on the van; unsecured loans are not.
- VAT: input VAT is generally claimable on vans and single-cab bakkies, but not on vehicles built mainly for passengers.
- Wear and tear: SARS accepts a four-year write-off period for delivery vehicles.
- Best fit: asset finance for new vans; unsecured loans for deposits, used vans or fast purchases.
What is business van finance?
Business van finance is any credit arrangement that spreads the cost of a commercial van over time. Courier firms, plumbers, electricians, caterers, distributors and cleaning companies rely on vans to earn income, so the vehicle usually pays for itself through the work it enables. The right type of van finance depends on whether you want to own the vehicle, how long you plan to keep it, and whether you have a deposit available.
What are the main types of business van finance?
Instalment sale agreement
An instalment sale is the most common way to finance a van in South Africa. The finance provider pays the dealer, the business pays monthly instalments over several years, and ownership passes to the business once the final instalment is paid. The van itself is the security, so the provider can repossess it if payments stop. A deposit or balloon payment can lower the monthly instalment but raises the total cost.
Lease or full-maintenance rental
With a lease or rental, the business pays a monthly fee to use the van and returns it at the end of the term. Full-maintenance rentals bundle servicing, tyres and sometimes insurance into the fee. Leasing keeps cash free and makes budgeting simple, but the business never owns the van and may pay penalties for excess kilometres or damage.
Unsecured business loan
An unsecured business loan gives the business cash to buy a van outright, often a used one, or to fund the deposit on an instalment sale. Because the loan is not secured on the vehicle, the business owns the van immediately and can sell or modify it freely. Unsecured loans are short-term and cost more per year than asset finance, so they suit smaller amounts or situations where speed matters.
How do the van finance options compare?
| Feature | Instalment sale | Lease or rental | Unsecured loan |
|---|---|---|---|
| Who owns the van | Business, after final payment | Finance or rental company | Business, immediately |
| Security | The van | The van | None |
| Typical term | Several years | Several years | 90 to 180 days via business-loan.co.za |
| Deposit | Often required | Usually none | Not applicable |
| Best for | New vans kept long-term | Predictable fleet costs | Used vans, deposits, urgent purchases |
Can you claim VAT and wear and tear on a business van?
A VAT-registered business can generally claim input VAT on a van, because the VAT Act blocks input VAT only on a motor car, defined as a vehicle constructed wholly or mainly to carry passengers. Panel vans and single-cab bakkies are built mainly for goods, so they usually qualify when used for taxable supplies. Double-cab vehicles are riskier: The Tax Faculty reports a case in which a crew-cab van with passenger space making up 65% of its length was classified as a motor car and the input VAT was denied.
For income tax, SARS’s Binding General Ruling 7 accepts a write-off period of four years for delivery vehicles and five years for passenger cars. That means a business can deduct roughly a quarter of a van’s cost each year. Confirm your position with your tax practitioner before you buy.
How do you choose the right van finance?
The cheapest-looking monthly instalment is not always the cheapest van. Before committing, work through these questions:
- What is the total amount repayable, including any balloon payment and fees?
- How long will you keep the van, and what will it be worth at the end?
- What will insurance, tracking, fuel, tyres and servicing cost each month?
- How many kilometres will the van travel, and does a lease limit that?
- Will the income from the van cover every monthly cost with room to spare?
As a rule of thumb, asset finance suits new vans you plan to keep for years, leasing suits businesses that want fixed fleet costs, and a short-term unsecured loan suits used vans, deposits and time-sensitive purchases such as securing a delivery contract. Our guide to funding options for courier companies covers fleet funding in more depth.
How can business-loan.co.za help with van finance?
business-loan.co.za is operated by New Heights Finance, a finance broker. For established companies with at least 12 months of trading and R1 million or more in annual turnover, accredited lenders in the network offer unsecured business loans from R50,000 to R6 million over 90 to 180 days, which can fund a used van or a deposit. On R100,000 over three months at the quoted 50% APR, the interest is R12,500. For longer-term vehicle funding, see our page on business equipment finance. [CLIENT INPUT NEEDED: confirm whether New Heights Finance arranges vehicle asset finance and add a short client example of a van purchase.]
Frequently asked questions about business van finance
Can I claim VAT on a business van in South Africa?
Generally yes, if your business is VAT-registered and the van is used for taxable supplies. The VAT Act only blocks input VAT on vehicles built mainly to carry passengers, and panel vans and single-cab bakkies are built mainly for goods.
Over how many years can a business van be written off?
SARS Binding General Ruling 7 accepts a four-year write-off period for delivery vehicles, compared with five years for passenger cars. Your tax practitioner can confirm how this applies to your business.
Do I need a deposit for van finance?
Many instalment sale agreements ask for a deposit, especially for newer businesses or used vehicles. Some businesses use a short-term unsecured loan to fund the deposit, which lowers the monthly instalment on the asset finance.
Is it better to lease or buy a business van?
Buying suits businesses that keep vans for many years and want to own the asset. Leasing suits businesses that want predictable monthly costs, regular vehicle upgrades and no resale risk.
Can a new business get van finance?
It is harder. Asset finance providers may ask for a larger deposit or personal surety, and unsecured lenders in the business-loan.co.za network require at least 12 months of trading and R1 million in annual turnover.
Get funding for your next van
If your business qualifies and needs cash for a van or a deposit, one online application reaches multiple accredited lenders.
business-loan.co.za is operated by New Heights Finance, an independent finance broker based in Hillcrest, KwaZulu-Natal. New Heights Finance does not lend money or make credit decisions; accredited lenders assess each application and set their own terms. This article is general information, not financial or tax advice.
