Depreciation

[odelay]

I'm getting a 4dr renegade auto, petrol.
It will be used for work as a daily driver and I do high kms, I anticipate doing 40,000kms in a year so at the end of my 4yr CHP it will have about 160,000kms on the clock.
I have to work out what the residual should be, does anyone have any idea what it would be worth?

[Chad_TJ]

oh mate it would be an absolute guess but id say around 25 grand, maybe 30 if your lucky

[odelay]

I was thinking around $14k... so you think I'm slightly underestimating?

[Chad_TJ]

Yeah well a 4 year old TJ is worth about that with the same km's, and the renegade 4 door is worth a considerable amount more than 29 grand, so yeah i think you are under estimating abit. i reckon 25 grand. around there.

[Laz]

160 K's is like 8 years normal driving, based on a purchase price of ? i'd say i'd be aiming for 30% residual (if you can) and you should end up ahead.

As an example, a $30k wrangler in the same nic would sell at the moment for about $12k so with a 30% residual you'd be 3K in front ($9K payout figure)

You can be less conservative and have a punt ....

[yumpet]

ill give ya 14k now and then you can skip all the driving and stuff

[Bomber]

If it's salary packaging that's part of the issue there's a formula the tax department uses to calculate a residual on a lease, if the residual is lower than that formula only the amount of the payment up to the foirmula is tax deductible. In practice, say the answer to the formula is $1000 per month for a 40% residual and $1200 a month for a 35% residual but a 40% residual is all that is allowed the extra $200 is not tax deductible. Bottom line, if it's a lease that involves tax get professional advice before signing the contract and any residual you calculate basically becomes irrelevant.