About novated leasing
What is a novated car lease?
A novated car lease is the smartest way to get behind the wheel of your dream car. It's a unique agreement among you, your employer, and novated lease provider like Novated Choice. Just like other forms of car finance, a novated lease involves regular payments over a fixed term, with a residual payment due at the lease's end. But unlike other car finance, payments are made using pre-tax dollars, so it has the benefit of reducing your taxable income.
Why choose a novated lease?
A novated lease can instantly slash thousands of dollars off your new car's price tag by exempting you from paying the GST. But the benefits don't stop there. Because a novated lease is paid from your salary before tax it can offer you tax savings. You can also roll in all your car's running costs— fuel, registration, maintenance, and insurance—boosting your savings even more.
Can I use a novated lease for a used car?
Yes! As long as the vehicle isn’t too old and meets the terms of the agreement, you are able to pay for them using a novated lease.
Why choose a novated lease?
How a novated lease works
Your Employer
Your employer agrees to set up regular, automated payroll deductions from your pre-tax salary. Our dedicated team helps them set up this arrangement, ensuring a seamless process for you and them.
You: The Employee
Novated Leasing is available where you use the vehicle for business or personal purposes. Here at Novated Choice we will tailor the solution to meet your needs.
In exchange for the use of the vehicle, you agree to salary deductions. Novated leasing is available whether you use the vehicle for business or personal purposes.
Novated Choice : Us
We use our years of experience in novated leasing to handle everything from helping you find the vehicle, locking in the price to establishing the lease. We then manage all the administrative, contractual, and compliance aspects of the transaction. Too easy!
Next steps with Novated Choice
A step-by-step guide
to novated leasing
to novated leasing
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1
Get a quote
Whether you've set your sights on a specific car or are eager to explore what’s available we can help you explore your options and determine your budget for your shiny new ride.
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2
Novated Choice contacts your employer
To make sure your employer is on board, we shoot over a brief email, detailing the easy steps they need to take to kickstart your novated lease. We do as much of the legwork as we can to make it as easy as possible for them.
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3
Fast approval process
Once you provide all the necessary details, you can expect approval in just a few hours in most cases. We prioritise efficiency to get you behind the wheel sooner.
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4
Ready, Set, Drive
Pair your bluetooth, fasten your seatbelt, discover the latest cool car features, and get ready to show off your car to your friends and family.
Novated lease end
What happens at the end of my novated lease?
End of Lease? Don't worry, it’s not the end of the road.
You get to choose the way you want your journey to go.
Upgrade to a new car
Keep benefiting from a novated lease while enjoying the enhanced features and technology of a new model upgrade. Your payments can stay the same and you get a brand new novated lease vehicle of your choice.
Adjust Your Lease
Happy with your car and want to continue with the benefits and potentially pay less? You can refinance the residual amount and extend your lease to lower repayments and ease the financial burden.
Own your car outright
Love your car and want to own it outright? Pay the balance of your lease and the car is yours. Keep in mind when selling your existing car the residual payment is often less than the car’s value at the end of the lease. This can mean you could get to pocket the difference.
Market insights
PHEV popularity and incentives pave way for incoming models
National Automotive Leasing and Salary Packaging Association (NALSPA) says its data shows novated lease demand for plug-in hybrid vehicles (PHEV) has tripled in recent months.
“It’s never been more affordable and accessible to buy a plug-in hybrid vehicle in Australia – and it’s driving demand. A range of new PHEVs have already hit Australian roads this year with more in the pipeline, plus the government’s FBT exemption is providing the added incentive for motorists,” Mr Martin said.
https://fleetevnews.com.au/phev-popularity-and-incentives-pave-way-for-incoming-models/
Here are some of the new PHEVs Australia can expect in the near future:
Here are some of the new PHEVs Australia can expect in the near future:
- BYD Shark Ute
- Chery Tiggo 7, Tiggo 8 and Tiggo 9 Pro
- Chery TJ-1
- Chery Omoda 7
- Cupra Terrama
- Ford Ranger
- GAC ES9
- Geely Galaxy L7
- GWM Haval 6
- Hyundai SantaFe
- JAC T9
- Jeep Cherokee
- Jeep Compass
- Kia Sorrento
- LDV eT60
- Leapmotor C10
- MG HS (Next Gen)
- Mitsubishi Pajero
- Mitsubishi Triton
- Volkswagen Amarok
GET IN TOUCH
Drive smarter, save more. Get started today!
Drive smarter, save more. Get started today!
Frequently asked questions
You can put almost any car under a novated lease: New, used, even currently owned, as long as it is under ten years old at the end of the lease term (exceptions can be made on referral).
Types: Petrol, hybrid, electric, plug-in hybrid with a carrying capacity under one tonne. Cars cannot be used for rideshare, taxi or delivery or carry 9 passengers or more.
Just like other forms of car finance, novated leasing involves regular payments over a fixed term, with a residual payment due at the lease's end. But unlike other forms or finance leases, these payments come out of your pre-tax salary, reducing your taxable income. You also save GST on the car as it is not included in the amount financed (up to a maximum amount) and your running costs are budgeted and paid in one easy regular payment.
Almost everything involved in having a car: finance, insurance, registration, fuel, charging, tyres, and servicing. We also help with sourcing the car and end-of-lease options.
You can lease a car anywhere between one to five years. Novated leasing is a fixed-term lease and not designed to be broken early, otherwise you may incur additional fees and could end up paying more than the market value of the car.
No. You can drive as little or as much as you want. Estimated distance driven is only important for forecasting running costs.
There are three options available:
1. Contact us to adjust the budget
2. Unused money can be sent back to you via your employer payroll at the end of the novated lease
3. Money can be rolled over to you if you intend to get a new novated lease car or to extend your lease
There are two options available:
1. We can make a one-off request to your payroll to have an additional amount deducted from your pay
2. We can make an ongoing adjustment to your running cost budget
No. The post-tax component (Employee Contribution Method (ECM)) removes the need to pay FBT.
The ATO does not allow a novated lease to be paid down to zero. The amount you need to pay at the end of the lease is calculated according to ATO rules applied to amount financed.
There are three options available to you:
1. Pay the balloon payment plus the remaining lease payments and buy the car outright
2. Pay lease payments directly to financier and running costs with post-tax dollars
3. We can organise transfer of the lease to new employer if they allow this
There are three options available to you:
1. Upgrade to a new car and start a new novated lease
2. Pay out the residual amount and own the car
3. Lease the same car again (re-lease) for another period of time
No. You can go to any licenced and registered service provider. Simply attach your receipt to your on-line portal as instructed and you will be refunded for the cost of works conducted.
Yes. Not only do you get all the other benefits of a novated lease, such as saving the GST on the purchase price of the car and packaging the running costs, under the government’s EV discount, your electric car will not attract fringe benefits tax (up to the luxury car tax threshold). This means the whole novated lease payment is made from your pre-tax, rather than post-tax salary, reducing your taxable income.
Not only do you get all the other benefits of a novated lease such as saving the GST on the purchase price of the car and packaging the running costs, under the government’s EV discount, your electric car will not attract fringe benefits tax which means there is not post tax payment required. This means the whole novated lease payment is made from your pre-tax salary, which means you could be paying less tax.
All full electric and plug in hybrid cars are eligible for the discount, as long as the value of the car is below the Luxury Car Tax (LCT) threshold for fuel efficient vehicles at the time it is first sold (brand new).
You can only include the charger if it is included in the cost of the car. The tax rules at the moment will not allow you to package third party charges that are bought separately.
Yes you can, for full electric cars only. You can choose to either claim 4.20 per kilometre or if charging at a charging station you keep the receipt and log the claim in your customer portal.
Note: you can only choose to use one or the other method during an FBT year the rules do not allow for a combination.
