Novated Leasing
Novated Leasing
Save Money on Your Car Finance with Novated Leasing
Novated leasing is a great way to make significant savings on your vehicle. It is a type of car finance, where your employer pays for your car lease out of your salary.
Get in touch with us now, call 1300 225 525 or reach out using our online form to get started today.
What is Novated Car Leasing Exactly?
A novated car lease allows you to drive the car of your choice while receiving some great tax savings and benefits. You can save thousands on the purchase price and running costs of a new or used car. Novated leasing also offers the convenience of cashless motoring by bundling all the associated vehicle expenses into one payment. You can also get access to discounts not only on the vehicle but also on the associated costs such as fuel, maintenance, tyres, and repairs, making novated car leasing an all-round attractive idea.
How Does Novated Leasing Work?
Your employer pays for your car lease out of your salary through a combination of pre-tax and post-tax salary deductions. Here’s how that works in practice. . .
The employee decides on a car and receives approval. An agreement is setup between the employee, the employer, and the novated car lease provider.
Payments to the novated leasing company are made by the employer, from the employee’s salary.
The employee gets the car they want, saving on tax and running costs, including vehicle price, fuel, maintenance, and tyres.
The car related costs and payments are all managed by the employer, the employee does not have to worry about anything else.
Why Choose Novated Leasing?
- Bundled Convenience – All car related costs can be packaged as one easy payment deducted from your salary.
- Tax Savings – Your PAYG can be reduced through paying for your car and its running costs through pre and post-tax salary deductions made by your employer.
- Reduced Purchase Price – Access fleet discounts on cars to significantly reduce the price of your new vehicle.
- Lower Running Costs – Take advantage of discounted fuel, service, maintenance, and tyre purchases.
The Benefits of Novated Leasing
- Choose Any Car
- Access Fleet Pricing and Discounts
- Save on Income Tax
- Receive a Fuel Card
- Competitive Interest Rates
- Get GST Credits
- Complete Cost Transparency
- Everything Taken Care of For You
From tax and cost savings through to control, flexibility and convenience, a novated lease has many benefits.
Understanding The Tax Benefits and What is Fringe Benefit Tax
Your novated car lease costs are salary packaged, however, under tax law these benefits are considered ‘fringe benefits’, consequently a fringe benefits tax applies to your car. While you take advantage of GST credits and a reduction in income tax, your employer is liable for FBT for offering you the novated lease. This cost is usually passed onto the employee as post-tax payments.
There are two ways to calculate FBT on cars – the Statutory Formula Method, and the Operating Cost Method. Either can be used depending on the situation and, typically, the amount of business use the vehicle in question receives.
Take Advantage of Supercharged EV Savings
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The Australian government is trying to incentivise the adoption of electric vehicles by reducing their cost. Electric cars under $89,332 are now FBT exempt. With a novated car lease on an EV, you pay NO FBT, NO INCOME TAX and NO GST on the car and its associated running costs including your lease payments, fuel, insurance, registration, tyres, and servicing.
Novated leasing savings are already significant, but this new legislation takes the game to the next level.
Currently, EV’s are eligible for FBT exemption until mid-2027. PHEV (Plug-in Hybrid Electric Vehicles) are eligible until April 2025.
| <custom class="" style="color: var(--primary);">Finance Car and Out of Pocket Running Costs</custom> | <custom style="color: var(--primary);">Novated Car Lease – Out of Pocket</custom> | <custom style="color: var(--primary);">Novated Car Lease with FBT Exemption – Out of Pocket</custom> | |
|---|---|---|---|
| Example Car | Mitsubishi Outlander | Mitsubishi Outlander Aspire | Mitsubishi Eclipse Cross ES PHEV |
| Car Price D/A | $48,380.00 | $48,380.00 | $49,690.00 |
| Monthly Cost | $1,386.89 | $1,134.50 | $678.23 |
| Weekly Cost | $320.05 | $261.81 | $156.51 |
| Annual Cost | $16,642.68 | $13,614.00 | $8,138.76 |
| Life of Lease | $83,213.40 | $68,070.00 | $40,693.80 |
| % Saved |
DISCLAIMER: *Based on 15,00km/yr, 5 year lease term and $70,00 annual salary, includes fuel but no EV charging
Why Choose FinanceBeagle?
The Company
FinanceBeagle are a family-owned and trusted business within Queensland, servicing the industry for over 60 years.
The People
We have a team of experts that offer a wide range of experience across all areas of finance and will work alongside you to ensure you get the best results.
The Solution
By having access to over 30 of the country’s leading lenders, we’re able to sniff out the best marine financing for you no matter your financial situation.
The Service
Your dedicated FinanceBeagle broker is here to work for you. We do all the hard stuff, using our expertise to make the process quick, easy, and stress free.