A novated lease is a type of car finance which is being more readily adapted by Australian’s who earn in excess of $50,000 a year.
A novated lease is a three-way agreement. It is arranged between your employer, the car finance company and you and it is a form of salary packaging.
Novated Lease Salary Packaging is being used more and more now by companies who wish to attract better employees. After all, the car that you purchase on a novated lease does not have to be used for company usage. It can be used purely for personal use.
There are many benefits to a novated lease and here are just a few of them:
- Can make a deposit reducing payments
- Can choose any car whether new or used
- Repayments come out of pre tax earnings
- If you leave your employer you can take the car with you
- Can pay for petrol, tyres, insurance, roadside assistance and other car maintenance out of your pre tax earnings
The money for the car repayments comes out of your pre tax earnings, this means if you get paid $1000 gross per week (pre tax) and your car repayment was $150 a week, this $150 would come out of the $1000 meaning that you would only be taxed on $850 as opposed to the $1000.
This is why novated leasing is a little bit more difficult to explain but hopefully we have dispelled any myths and have clearly explained it to you here.
If you want more information on Novated Lease or Salary Packaging then click on one of the ads around and deal direct with a car finance company or contact us through the enquiry form and we will arrange for someone to call you at a convenient time. We know that you will be so glad you did.
To work out how much you can save with a novated lease, use our easy Novated Lease Calculator to calculate your savings!
If you are heading to the UK, we strongly recommend you check out car leasing options there, click the following link to view UK car leasing and contract hire offers.
If you are bored at work why not play some car games to waste the time away!
Use our free credit card comparison service to get a better deal. Why pay an annual fee? Get the best No annual fee credit card. Balance transfer credit cards at low low rates.
Other sites which may be of interest to you include these Australian favourites:
• Car Lease
• Car Finance
• Cash Loans
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