What is a Novated Lease?

A Novated Lease is a type of finance contract between an employee, an employer, and a financier. It is usually an arrangement with salary packaging and uses a combination of pre-tax and post-tax salary deductions to make finance repayments, thereby maximising tax savings.

How does it work?

A Novated Lease is arranged as part of a salary package between yourself, and your employer and repayments are deducted from your pay. However, there are a number of things to consider before entering into a Novated Lease. Firstly, do you plan on staying employed by your current employer for the duration of the lease, since you may still be liable for the vehicle should you lose or change jobs? Secondly, what terms are you comfortable with under the lease, e.g. loan term, balloon/residual payments, what are your options at the end of lease, lease inclusions etc.

It is extremely important to fully understand the pros and cons of a Novated Lease arrangement prior to entering into one. You must also check that your employer is open to such arrangements under a salary packaging plan. For more information about Novated Leases and the pros and cons associated, speak to one of our specialist Consultants today on 1800 538 287. They’ll be more than happy to answer any questions you may have and best of all, it’s completely obligation-free.

Is a Novated Lease right for me?

A Novated Lease can provide many advantages including huge tax advantages. However, we always advise that client’s speak to their Financial Advisor prior to making a decision that may affect their financial situation.

For more information about Novated Leases or the application process, speak to one of our specialist Novated Lease Consultants today on 1800 538 287. Once you have spoken to your employer to discuss the option of a Novated Lease and have their approval, simply apply online to fast-track your novated lease application.