Every car needs fuel, tyres, maintenance, registration, insurance and in most cases some form of finance. Salary Packaging or a Novated Lease simply lets you pay for these expenses before tax, so you pay less tax and have more money in your pocket.
A Novated Lease is simply an arrangement between the financier, an employer and an employee. The arrangement allows an employee to sacrifice (hence the term Salary Sacrifice) a portion of their salary back to the employer, who uses these funds to pay the vehicle’s running costs. This means the employee pays less income tax, no GST on all running costs including the finance that is salary packaged, whilst retaining full control of the vehicle for 100% personal use.