What's a novated lease?
A novated lease is a finance lease with a separate document attached to it called a novation agreement. This agreement temporarily transfers the legal obligation of payment from employee to employer.
The employee remains the leaseholder, however by transferring the payment
across, a number of financial benefits become accessible.
The organisation pays for the lease out of the employee’s salary, and this happens before income tax is applied, so in essence you’re allowing your staff to pay for their cars, tax free.
Through the salary packaging agreement, Autopia roll all the other expenses of running a car into these payments, such as insurance, petrol, maintenance and servicing, roadside assistance etc, so these become tax free too.
And, because a registered business is now covering the costs, GST is claimable,
so it really is the most tax-efficient way to own a car.
In addition, the salary packaging agreement actually protects the employer,
by allowing the business to rescind the novation at any time, so when an employee
leaves, so does the lease.
It’s a flexible fleet, at no additional cost to the business.
Click here to see how it all works.