Short answer: yes, you can have a Novated Lease in Adelaide if you’re an Australian tax resident earning a salary or wage.
Novated leases are a popular financial tool in Australia, especially for those in South Australia. They offer a range of benefits, including significant tax savings and the convenience of all-inclusive car ownership.
Long answer, you can have a Novated Lease in Adelaide if:
You Are A Government Employee
If you work for the government (state, federal, or local), you are free to explore your Novated Lease options by following the procedure later in this guide.
All government departments offer their employees Salary Packaging, and one of the most used benefits is a Novated Lease. Importantly, most government departments offer choice when sourcing the vehicle, the finance (car lease), and your insurance.
Having the option to seek competitive quotes could save you thousands o,f dollars extra per year. For a competative quote in seconds try our online calculator or call us on 1300 990 880.
You Work for a Private Company
Talk to your employer. Does your employer have a Salary Packaging Provider or do they offer it internally? You can find out this information by discussing Novated Leasing with your payroll or HR department.
A Novated Lease in Adelaide is the same as in any other state and requires an employer to co-sign a Novation Deed. This is a document that allows your employer to pay for the finance (lease) by deducting an agreed amount from your pre-tax salary. Your employer is also able to claim the GST on these amounts and pass this benefit back to you.
If you are having any difficulty in getting this information, please feel free to contact us on 1300 990 880 or 8338 4427. We can either send through some information for your employer or come out to your workplace and do a presentation. Our service is free to your employer, and we do all of the work.
Vehicle Solutions Australia is a provider to over 365 private companies and Government departments throughout Australia. We Salary Package for employers with 3 to 30,000 employees; we are happy to help all employers offer their employees this benefit.
Steps to Getting a Novated Lease
Choose a Car
This is one of the most important decisions to make. The car needs to fit your lifestyle and also be a vehicle that will hold its value to maximise its sale value at the end of the lease term.
Each lease has a residual value, which is deemed to be the value of the vehicle at the end of the lease term. The ATO sets stringent guidelines on residual values and sets these as percentages based on the lease term. For example, if your lease is over 5 years, your residual value must be between 25% and 35% of the vehicle’s purchase price. If you choose a vehicle that holds its value, any money you receive over the residual value is yours to keep, tax-free.
Get a Vehicle Pricing Request
After choosing the vehicle, getting the best price is just as important. Vehicle Solutions Australia is the only Salary Packaging provider to have built and own a 100% transparent online new vehicle buying platform called Motorbuys. Motorbuys will send your vehicle pricing request to every dealership in the region(s) you choose, completely anonymously.
Dealerships will submit their best deal directly into the platform for you to view and analyse immediately. Dealerships also need to advise a delivery timeframe. This means that within 24 hours, you will know the best price and which dealerships have your new car in stock, ready for delivery.
Get a Quote
Use our online calculator to see how much you will save in tax and also exactly what your chosen car will cost you from your take-home pay. Click on the link below to get started.
https://vehiclesolutions.com.au/evs/
Ask Questions
There’s no such thing as a stupid question. The only way to understand where the savings come from and exactly how the process works is to ask lots of questions.
For employees waWeted Lease in Adelaide, a local SA-owned and opera every dayted Salary Packaging company, and we’re here to answer all your questions. Every day, we talk to SA employees either in person or over the phone. To get in touch, either phone us on 8338 4427 or 1300 990 880, or complete the online enquiry form, and we will call you back at a time that suits you. We’re also happy to meet either outside of work or at your workplace.
Get your finance approved
Once you’re happy with the numbers, get your finance approved. We can do this within 5 minutes over the phone or in person. Normal credit application criteria apply, however, a Novated Lease is often a little easier to get approved than normal car finance.
Sign the Documents and Collect Your Car
We’ll come to you with all of the documents you need , we. We’ll go through every page in detail, explaining everything in plain English. Once you’re happy with the information, sign where applicable, and we’ll get your employer to co-sign the Novation Deed and settle the contract. Once settled, you’re free to pick up your car, and your Salary Package will begin within the next few payroll cycles.
What is a Novated Lease?
A novated lease is a flexible financing option that allows you to pay for your car using pre-tax income. It involves a three-way agreement between you, your employer, and a financier, and it’s recognised by the Australian Taxation Office (ATO).
With a novated lease, you can bundle all your car-related expenses—including fuel, insurance, registration, and maintenance—into a single, regular payment. This can significantly reduce your taxable income, leading to significant tax savings.
Salary packaging your car expenses through a novated lease simplifies your financial management and provides substantial benefits.
Benefits of Novated Leasing
Novated leasing offers several advantages:
- Lower Taxable Income: By incorporating your car expenses into a pre-tax salary deduction, you can significantly reduce your taxable income. This leads to lower income tax payments throughout the year.
- Simplified Budget: With this flexible financing option, all your car costs are bundled into one regular payment, making budgeting easier and more predictable.
- Flexible Vehicle Options: You can choose to lease a new or used vehicle, providing flexibility to suit your needs and preferences.
- Potential FBT Exemption: If you opt for an eligible electric vehicle, you may be exempt from Fringe Benefits Tax (FBT), leading to further savings.
- Potential Profit at Lease End: If the vehicle’s market value exceeds the agreed-upon residual value at the end of the lease, you can sell it and keep the profit tax-free.
Eligibility and Requirements
In order to enjoy the benefits of novated leasing, there are certain criteria that you must meet:
- Employer Participation: Your employer must offer salary packaging services, including novated leasing.
- Stable Income: You should have a consistent income to cover the lease payments over a period of 1 to 5 years.
- Vehicle Eligibility: The car you choose must meet the financier’s specific requirements.
- Creditworthiness: You must meet the lender’s credit criteria.
- Employer Consent: Your employer needs to agree to participate in the novated lease and deduct the lease payments from your pre-tax salary.
Frequently Asked Questions
Who is eligible for a Novated Lease in Adelaide?
You can qualify for a Novated Lease in Adelaide if you earn a salary and pay taxes. Both government and private sector employees are eligible, provided their employer supports salary packaging and agrees to the novation agreement.
How does a Novated Lease benefit employees financially?
A novated lease qualifies as reducing taxable income by providing for payments related to motor vehicles from pre-tax salaries, such as petrol, insurance, registration, and servicing costs. This arrangement earns you tax savings and better budget management.
What are the steps to getting a Novated Lease in Adelaide?
- Government Employees: Begin by exploring options and obtaining competitive quotes.
- Private Sector Employees: Confirm with your HR or payroll department if your employer offers salary packaging.
- Choose a car, get a competitive price using tools like Motorbuys, and calculate your savings using an online calculator.
- Get finance approval and finalise the documentation to start the lease.
Can I choose any car for a Novated Lease?
Yes, you can choose any car that suits your lifestyle. However, it’s wise to select a car with a high residual value. This means the car will retain its value over time, potentially leading to tax-free profits when you sell it at the end of the lease.
What if I have questions about Novated Leasing?
Vehicle Solutions in Australia offers free consultations to employees and employers. They provide complete face-to-face service or phone calls to address any inquiry. Reach them on 1300 990 880 or 8338 4427, or seek assistance through the online inquiry form.
