Taking on novated lease for a second-hand rather than a new vehicle may present benefits, especially for the employee. The costs of used cars can be lower than new, allowing the employee to acquire a vehicle with less salary sacrificed. With the lower cost, the option may be accessible to more employees. From another perspective, it may provide the opportunity to purchase an upgraded used model where the new version is considered too expensive.
The employer realises the benefits of tax deductible lease payments and vehicle running costs. By reducing their salary by the sacrificed amount, employees may move to a lower tax bracket, saving them on tax payable. By not taking on the finance themselves, employees may have greater potential to take on finance for other purposes.
Novated Lease may be seen as a special privilege used by employers as an effective measure to offer to employees as an incentive, bonus or in lieu of a pay rise.
Leasing attracts highly competitive interest rates with commercial rates typically lower than personal car loans. Novated Leasing allowing employees to purchase a motor vehicle at the lower business interest rates. Saving on total interest payable on their purchase.
To find out what competitive rates we can source for your Novated Lease, give us a call.
- Tax-deductible expenses and payments for employers.
- Less tax paid by employees.
- Competitive rates, cost-effective interest rates.