How do novated leases work?

With a novated lease, you use your pre-tax salary to pay for your car and running costs. It sounds so simple, but it’s a total game-changer. Let’s break it down into steps:

An agreement is set up between you, your employer, and a lease provider.
Instead of you paying for your car outright, you enter into a lease agreement for the car for a fixed period between 1 and 5 years.
Then, your employer takes on the novated lease payments and makes them on your behalf by deducting the cost of your car from your pre-tax salary, thereby reducing the income tax you pay each pay cycle.
Your car payments are fixed, so you know what you’re paying for your car each month.

‍

Bundle all your on-road running costs and save thousands

One of the most exciting features of a novated lease is the opportunity to include all your car’s running costs in your lease package - something that’s not possible if you buy the car outright or using a standard car loan.

You can salary sacrifice not only the repayments on the vehicle itself but also all running costs associated with the vehicle.

This allows you to avoid the dreaded “bill shock” (when you get a whole bunch of big bills at once) by smoothing them out into predictable monthly payments.

It also allows you to access additional tax reductions benefits by further reducing your taxable income, plus you save the 10% GST component of the running costs. All of this can save you thousands of dollars every single year.

It’s up to you which running costs you’d like to include with your lease. Naturally, you can save more if you include more. But if you only want to include some (or none), you can. We offer total flexibility to build something custom to your needs.

See our plans to find out more.

‍

How do I apply for a novated lease?

To salary sacrifice your car and qualify for a novated lease, you do need to be employed and paid via PAYG. Your employer also needs to offer novated leasing.

If your employer doesn’t offer novated leasing, we’re happy to talk to them and walk them through the incredibly easy process.

We love making people’s lives easier, so we’ll work hard to make sure both you and your employer are happy!

‍

‍How much can you save with a novated lease?‍

Use our novated lease calculator to get an instant estimate on how much you can save. Our guess? Thousands. Every year.

‍

Why choose a novated lease for your next car?

If you’ve been reading through our website, we’re guessing you’ve probably got the gist by now - we’re nothing if not enthusiastic about the incredible benefits of novated leasing.

But if you’re a first-time visitor, then here’s our elevator pitch for why novated leasing will change your life for the better:

Reduce your tax bill by paying for your car using your pre-tax income
Bundle your running costs to get additional tax benefits every year
Avoid GST the car’s running costs (e.g. fuel, servicing)
Save up to $6,334 in GST on the price of the car
Get wholesale pricing for your car
No bill shock thanks to one simple, predictable monthly payment
Flexible plans and end-of-lease options

In just seven bullet points, we’ve listed tens of thousands of dollars in savings that you can’t get any other way - not by buying the car outright, and not through a traditional car loan.

There’s a word for that: “no brainer”.

‍

Is novated leasing right for me?

If you’re looking at buying your next car, you may be - and should be - considering a novated lease.

That’s because novated leasing is one the most cost-effective and financially rewarding ways for you to purchase and run your car. It is also one of the very few ways that an employee can create a significant tax break.

Novated leasing is a godsend for car seekers who want to be savvy with their budget but don’t want to compromise on their needs.

However, there are rare occasions where a novated lease might not be the best option.

‍

8 questions to ask yourself to know if a novated lease is right for you:

Do you have an employer (PAYG)?
Is your employer set up for novated leasing? And if not, are they willing to be?
Are you ok with having your employer involved in the process?
Is lowering your tax bill of high importance to you?
Are you spending more than you’d like on fuel and car servicing and would you like to use your pre-tax income to reduce your spend?
Are you interested in bundling all of your car costs within one easy monthly payment?
Are you ok with taking on monthly payments yourself if you’re in between jobs and without an employer (as you would with loans or credit cards)?
Is the car you get important, and would you like access to wholesale pricing to potentially get a better deal on a car?

If you answered ‘Yes’ to most of the questions above, chances are you’re a good fit for a novated lease.