Novated leasing is a cost-effective means for employees to finance their car purchases using pre-tax dollars, and is usually offered by employers in arrangement with salary sacrifice providers.
How Novated lease arrangements work
Employers deduct the pre-tax cost of car lease payments from your monthly wage, which reduces your taxable income and consequently your tax bill. Any employee can set up a novated lease arrangement, even if their employer does not currently operate these schemes, and the price you pay will be based on factors such as the make, model and age of vehicle. Your running costs can also be claimed back through your novated lease arrangement, and will involve calculating values such as distances travelled and fuel costs.
Benefits of a novated lease
Novated lease arrangements are beneficial for employers as well as employees. More workers are expressing their desire to get involved in novated leasing, which means employers can add value to their employee benefits packages when incorporating this type of salary package, at no cost to their organisation.
Employees can benefit from new cars at significantly lower prices than privately buying or leasing vehicles independently, and can also claim back expenses when the vehicle is used during the course of work. If you underestimate the amount claimed back through your novated lease, you can receive this overpayment back at the end of the year.
Novated leasing in Geraldton
Fleet Network offers novated leasing in Geraldton and other locations like Perth, Mandurah and Kalgoorlie, and can be arranged through employers or other nominated financiers, including sponsoring organisations. Call 08 6555 3854 to find out how to salary sacrifice and receive 20% of taxable deductions on the cost of your new car.