Many dealers advertise end of the year specials and these can mean genuine savings for canny buyers.

Commercial vehicles often get the biggest discounts, especially to ABN-registered buyers. When Mitsubishi Australia introduced the new Triton ute recently, it had a very sharp price for just this (very large) group of customers. Even if you are in the market for a sedan, wagon or sports car, it can be a handy negotiating tool to mention that you have an ABN. In some cases it will give the dealer an excuse to increase the discount on offer. The end of the month is the best time to buy a new car. And the end of the sixth month of the year is arguably the best time of all. Why? There are several reasons which combine to make this the case.

Why is it a good time?

Salespersons anxious to achieve their quota of sales will work harder to secure deals. In most dealerships it works like this: pay is by retainer plus commission. The commission will vary according to the number of sales. If you are employed by a mainstream dealership, you will probably be expected to sell at least five and maybe as many as 20 vehicles per month. Pressure increases as the last week rolls into view. Sales managers drop in more often for a friendly chat about sales techniques and finding new prospects. This means that the casual buyer who walks into this salesperson's office will be unbelievably welcome.

Savings to be made

On a $40K car, the buyer could easily benefit by at least $2000 from the salesperson's need to get his or her numbers up. For him or her, June is like any other month, but once you throw in your own end of financial year reasons, this begins to look like the best time to buy a car, but wait until the last few days of the month. And look for the unhappy salesperson or the one trying far too hard to make an impression, and a sale. You could even ask whether he or she has had a good month!

On a car with an RRP of about $40K, it may be possible to get as low as $34K, especially on an unpopular colour. Obviously, superseded models attract larger discounts. It is unlikely that any VZ Commodores are being held by dealers, but it might be worth asking the question. Don't forget to mention that the end of the financial year is approaching, and that you will sign on the spot if the deal is right. But do your research before you get to that point.

Typically, it is possible to get a discount of at least $2000 on a locally manufactured car with an RRP of $40K and in extreme cases closer to 10 per cent is available. Although it looks neater in the books if old stock can be invoiced to buyers before the close of trading on 30 June (or if that happens to be a Sunday, 29 June), it doesn't make all that much difference to dealers.

Crunch the numbers

There can be exceptions though. If for some reason a car has to be sold at a loss, then by doing the deal before 30 June, the loss becomes deductible for that financial year.

Many people in business would rather pay for a car than pay tax. As the end of the financial year approaches, if you see that you are likely to have to pay the ATO, it might make sense to buy or lease a car. Many accountants advise their clients to do just this.

So your trade-in is worth less than you thought? It always is. But you can claim a loss on sale over and above normal annual depreciation, provided that the trade-in figure is less than the depreciated value. If you have an ABN and pay cash for the car after borrowing money from the bank, using a credit card, or just raiding your very big piggy bank, then the GST offset can make a significant difference come BAS time.