What Do I Need to Know About Obtaining a Used Car with a Novated Lease?
Some people think that only a new car can qualify for a novated car lease, but the fact is you can also novate a vehicle you are currently driving or even a privately-owned used car.
Interested in novating a used car or the one that you are currently driving? Here are the variables, or qualifications to facilitate this transaction:
How old is the car?
Well, it depends on the lease term, as long as the car cannot be more than ten years old at the end of the contract. It is the general rule, but, there are exceptions like in cases where a car has come to a point in its life where it is holding its value, for instance, antique or vintage cars. If you are unsure if your car is an exception, check with Vehicle Solutions to be sure it is.
Is the car free from any encumbrances or liens?
At Vehicle Solutions, while our skilled mechanics perform a thorough physical and mechanical inspection, our office staff will also do proper research to make sure that the car is free of any encumbrances or liens or that it is not being financed by another lender. We do these so there will be no problems in the future for all the parties involved.
Is it a luxury vehicle?
There are two variables for a novated lease on a used luxury vehicle, and that is whether you are a government employee or a private employee. Doing a novated used car lease on a luxury vehicle for a private employer is more complicated in terms of paperwork and tax implications, if you work for the government your used car will be treated very much the same as if doing a regular novated lease because the government does not pay company tax. For private companies, the tax deductions they can claim will be based on the portion of interest and depreciation as set under the luxury car limit.
Is it a big, heavy vehicle?
If it can carry more than 11 passengers including the driver or weighs more than 1 tonne, more than likely you can’t get a novated car lease. Though both are treated differently, both are not classed under “vehicles” under the Tax Act. It would be best to leave this with an independent tax adviser if you want to pursue it.
If after reading this and you think you qualify for a novated car lease, head on over to Vehicle Solutions. They are the experts when it come to novated car leasing. Also, check out motobuys www.motorbuys.com.au and use their online calculator. Motorbuys is a site that is designed to get a quick 2-minute pre-approval after a few simple clicks. Motorbuys is the only site that allows you to obtain an accurate quote that will help you make a more informed decision.