Are you planning to buy a car? Do you already own a car? What does it cost to run?
The good news is you could end up with more dollars in your pocket if you get a novated lease compared to owning it yourself. It’s true!
You don’t need to earn a fortune to save money.
All you need to do to take advantage of this legal (and easy) way of reducing your tax bill is to work for a company that offers it as a benefit. And if they don’t, think about changing jobs!
So what’s the difference between owning and a novated lease? The first thing is the running costs are paid from your salary before the tax is taken out. This reduces your income which also reduces the tax you pay.
What do we mean by running costs? Well the obvious one is fuel. You also have servicing, finance costs and insurance. When they are included in the lease the financier claims the GST input tax credit which is like you getting a 10 percent discount.
Sure it’ll take some time to get your head around the benefits. But do the research. Take the time and you’ll thank us.
There’s plenty of information online, including calculators that will detail the savings. Just Google novated leasing and start from there. Or talk to your HR people.
