Novated Leases are simple really. You pick a car and then save some money by using pre-tax dollars. Not enough detail? Keep reading.
If you’re planning to buy a car (new or used) using finance, and work for an employer that offers salary packaging benefits, you should ask some questions about
Novated Leases may sound complicated. And it will take some time to understand if it’s your first novated lease. But isn’t that the case with most things to do with money?
Once you get your head around the finance part and tax savings, the extra benefits that make car ownership easy are more than worth it.
For example, the cost of fuel, rego and servicing are all included in the monthly rental. This means you won’t get the high pump price blues, or pre-service financial anxiety attack. The budgeting is taken care of as part of the salary packaging.
With novated leases, most people can save some money compared to financing a new car using their post-tax salary.
If you work in a government role like health, policing or education, you can take advantage of the extra benefits on offer. There are also extra benefits for people that work in the Not for Profit sector.
Then at the end of the Novated Lease term (normally three years) you have several options. If you love the car you can own it. If your circumstances change you can sell it. Or, you can change your car with a new novated lease.