Do I Pay GST on a Novated Lease Car?
The simple answer is NO !
By Australian Tax law the leasing company must pay the dealership the GST included in the purchase. However the leasing company is then free to claim 100% of the GST payment from the ATO. So the amount you finance for the Novated Lease does not include the GST amount.
Therefore you do not pay GST on a Novated Lease car.
Then the payments on the lease include GST however these are claimed by your employer and the tax savings are passed back to you. This is an ATO guideline used by all Salary Packaging companies.
Does it have to be a new car?
This GST claim by the leasing company on a Novated Lease is available on any new, demo or used vehicle. The general rule is the vehicle cannot be any older than 10 years at the end of the lease. For example, a 5-year-old car can be leased for 5 years. You can even take advantage of the tax saving by arranging a Lease-back on a car you currently own or have on finance.
View more in our FAQ’s.
To find out more information or to get a quote on Salary Packaging your next car please call us on 1300 990 880 or use our online calculator.
To get the best Salary Package deal and save more than just the GST, you need to get the best price on the car. To get the best price on the car use our new online new car buying portal called Motorbuys. Motorbuys will send an anonymous request to every car dealership in your region. You then get to view every quote in detail and choose the one that best suits your needs. We then use this price to complete your Salary Packaging quote. The cheaper price means lower lease payments, lower residual and can even lower the cost of insurance.
www.motorbuys.com.au
