Novated Lease - Overview
A novated lease has become an increasingly popular form of vehicle financing over recent years. A novated lease combines many features of more traditional forms of vehicle finance to deliver some attractive benefits for both employers and employees.
A novated Lease is an agreement between your employer, yourself (the employee) and the financier, where the obligation to meet the repayments under the finance lease is with the employer.
With a novated lease agreement, you own the vehicle and have the right to take it with you should you change jobs and, structured correctly, there may be tax advantages with your remuneration package.
As with other leasing structures, repayments with a novated lease are flexible and amounts depend on the term, interest rate, amount borrowed and the residual payment.
Benefits of a novated lease for the employee include:
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Benefits of a novated lease for the employer include:
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Other issues that will need to be addressed before commencing with a novated lease include (note that through partnership arrangements, Private Fleet are able to provide a complete solution to the following issues)
- Salary Costing
- FBT (fringe benefits tax) calculations
- Fuel costs, maintenance costs calculation
- Current vehicle disposal
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Establish whether current employer offers salary packaging and novated leases or is agreeable to investigating the benefits of such a lease. |
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Obtain advice on novated leasing. Ideally this should be obtained from multiple sources such as:
Ensure that accurate modelling of personal financial implications is performed based on various scenarios. |
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Decide on a vehicle (take advantage of resources on our website or feel free to give us a call) |
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Reconfirm that approximate vehicle purchase price fits in with previous novated lease modelling. |
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Engage Private Fleet to source vehicle and negotiate fleet discount. |
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Choose novated leasing financier if not already known. (we can help here by putting you in touch with a partner novated lease financier or novated lease broker) |
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Private Fleet will arrange for supplying dealer to issue tax invoice directly to chosen financier. |
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Finance should be approved (if not, order will be cancelled and options re-evaluated as order is 'subject to finance'). |
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Deed of novation prepared and signed by relevant parties |
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Vehicle delivered with full tank of fuel |
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Payroll or HR department of employer sets up deductions for employees salary package. |
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Client welcomed to Private Fleet membership program. |
Please enquire now and we'll organise for one of our novated lease specialist partners to get in touch for a free, no obligation consultation.
Options other than a novated lease ? Find out about leases , hire purchase , car loans and operating leases
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Visit our novated leasing calculator , contact a finance consultant or call 1300 303 181 for more information. Click here to save thousands off the purchase price of your new vehicle |
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