Novated Lease
The main features & benefits of a 'Novated Lease' are
- It is mainly used by employees, for salary packaging of a car, for their employees.
- The employee usually leases the car on the agreement that the employer agrees to take on the full obligations under the lease agreement
- It is most suited to any employee who wants to include a motor vehicle as part of their salary package, as long as their employee does offer salary packaging as an option for their employees
- FBT, Fridge Benefit Tax Is payable on the vehicle, and expenses are usually passed onto the employee
- The FBT amount is calculated on the kilometres travelled each year, as the high the kilometre usually means the lower the FBT tax
- Where the amount financed is below the depreciated limit being $57,466, the employer claims the lease rental as the business expense.
- Where the amount is above the depreciation limit being $57,466, the employer claims the interest charges and depreciation up to the value of the depreciation limit being $57,466.
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