Before we discuss the benefits of novated leasing, let us understand what it means. It is nothing but a way to finance a car or vehicle. The process is a three-party agreement when an employee accedes to the terms of the lease with a financial institution, chooses a car, and the employer takes responsibility for the lease. The company will shell out payments for the lease on behalf of the staff and deducts the amount from the employee’s pretax earnings. These leases are not new and have become very popular of late.
According to an article published on https://www.business2community.com, a novated lease is the best way to include a vehicle in your monthly pay package. Your employer will take the cost of maintenance and vehicle payments from your pre-tax pay per month. So let us read on to learn about the benefits of a novated lease.
When opting for a novated lease, a portion of the payments comes from an employee’s pre-tax monthly salary. It means that your taxable earnings will be reduced and you would pay less tax all through the year. Besides, your novated lease not only includes your lease payments but also costs related to registration, maintenance, car servicing, and of course fuel. Therefore, using your pre-tax income to help you cover these daily expenses and possibly reducing your taxable earnings is an added benefit that you can enjoy.
Pay less on your brand new car
You always wanted to use a car so that commute to office and home becomes easy and convenient. When it comes to wide fleet discounts in Australia and preferred car dealer networks, it implies that you can choose your favorite car at a competitive price. Additionally, you not are required to pay GST when you buy a new vehicle. The vehicle and its operating expenses will attract GST, but the lease company or provider you choose must claim the input credits so that you do not pay the GST.
A reputed leasing firm has the ability to negotiate huge discounts from the company’s national supplier network and provide lucrative discounts to the staff. Servicing, purchase price, labor, tires, glass, and repairs are the items that you save as an employee. The savings are on retail for vehicle expenses.
Negotiation is easy
When it comes to an effective novated lease, it makes all things related to car maintenance super easy. Your leasing provider will take care of all price negotiation and supervise repairs and maintenance of the vehicle. The leasing company will walk the extra mile to guide the employees to choose the best suppliers. As an employee, all you need to do is drop your vehicles for servicing and pick the car up when the job is done.
All other things are covered in an employee’s salary deductions so that you do not need to open your wallet. You need not worry about the registration bill or costs related to the renewal of insurance. You also do not need to top up to cover simple repairs, expenses, and services.
Now that you know about the benefits of novated leasing, what are you waiting for, huh? Opt for novated leasing and enjoy hassle-free commute to the office.