Is it cheaper to buy a car via loan or lease in India?

It depends on the vehicle, tenure, and residual value. Leasing is often cheaper in the short term (3–4 years) for premium cars. Buying via loan can be more economical if you plan to keep the car long-term or the resale value is high.

What is a car lease in India?

A car lease (also called car subscription or operating lease) lets you use a vehicle for a monthly fee without owning it. Popular platforms in India include Myles, Revv, Orix, and corporate lease schemes by OEMs.

Is the security deposit in a lease refunded?

Yes. The security deposit is typically refunded at lease end, subject to vehicle condition. This calculator treats the deposit as a net-zero cost since it is returned.

Does a car lease include insurance and maintenance?

Many full-service leases include insurance and maintenance in the monthly fee. You can toggle these inclusions in this calculator. Always verify with the leasing company.

What are the tax benefits of car leasing for salaried employees?

Salaried employees can claim the lease amount as a reimbursement under Section 17 of the Income Tax Act if structured as a company car lease. This can significantly reduce the post-tax cost. This calculator does not include tax benefits.

What is the resale value of a car after 5 years?

Typically 40–55% of original price for popular Indian cars. Premium and luxury cars may retain 35–45%. Electric vehicles currently have lower resale values in India due to battery concerns.

Can I negotiate a car lease monthly amount?

Yes. Lease amounts depend on the car depreciation during the lease period, interest rate, and included services. Corporate or bulk leases typically get better rates than individual leases.

Is there a mileage limit in car leases?

Most Indian car leases come with mileage caps (typically 1,500–2,000 km/month). Exceeding the limit attracts per-km charges. If you drive more, a loan-based purchase may be more cost-effective.

What happens at the end of a car lease?

At lease end, you return the car. You do not own it. Some lessors offer a buyout option at residual value. With a loan, you own the car outright after the last EMI.

Which is better for a business — loan or lease?

For businesses, leases are often preferred as the entire lease amount is deductible as a business expense, reducing taxable income. Loan EMI principal is not tax-deductible for businesses.

Loan vs Lease Calculator — Free Online Tool

Loan vs Lease Calculator का उपयोग कैसे करें

1
Enter the vehicle price and your down payment amount.
2
Fill in loan interest rate and tenure in months.
3
Enter annual insurance and maintenance costs for the loan option.
4
Enter the expected resale value of the vehicle after the loan tenure.
5
Fill in the monthly lease amount and security deposit.
6
Toggle whether insurance and maintenance are included in your lease.
7
Click Compare to see total cost of ownership vs total cost of leasing.
8
Review the winner announcement and factor-by-factor comparison below.

Loan vs Lease Calculator के बारे में

Should you buy a car with a loan or lease it? The Loan vs Lease Calculator compares the total cost of ownership against leasing for the same vehicle and tenure — giving you a clear winner with exact numbers.

What This Calculator Compares

For the loan option, it factors in down payment, EMI payments, total interest, insurance, maintenance, and resale value. For the lease option, it includes monthly lease payments, security deposit (refundable), and any separate insurance or maintenance costs.

Key Considerations

Ownership: With a loan, you own the car after the last EMI. With a lease, you return it.
Flexibility: Leasing lets you switch to a new model every cycle without the hassle of selling.
Monthly Outflow: Leases typically offer lower monthly payments with all-inclusive pricing.
Mileage: Leases usually cap driving at 1,500–2,000 km/month.

Factor-by-Factor Comparison

Beyond just cost, the tool provides a qualitative comparison covering ownership, customization, flexibility, mileage restrictions, and access to latest models — helping you make a decision that fits your lifestyle, not just your wallet.

All calculations are done locally in your browser. No data is sent anywhere.

Loan vs Lease Calculator