CBB Salary Packaging 1300 763 505
Novated Motor Vehicle Leasing
What is a Novated Motor Vehicle Lease?
This is the purchase of a motor vehicle by the employee specifically leased by a financier. It is a three way agreement between the employer, employee and the financier whereby the employer agrees to deduct the lease payments from the employee’s gross salary. The arrangement involves the following:
A Novated lease term is generally between two to five years. Only new and late model cars will be entitled to be financed and accordingly the tax savings will only be available in these circumstances. Individuals should seek independent financial and taxation advice on the tax effectiveness of a novated lease.
What are the benefits of having a Motor Vehicle Novated Lease?
Benefits arises from the employee being able to package the costs of the leasing and running of the vehicle with PRE TAX dollars thus enabling the employee to save a considerable amount in taxation. Due to the fact that the employee is employed by a Public Benevolent Institution (PBI) there are substantial fleet discounts on the price of a motor vehicle which can be accessed directly by the employee.
There are also advantages to organisations that offer motor vehicle novated leases to its employees:
To get started or for more information, please contact CBB the not4profit people