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3 mins read
If you or your employees are interested in purchasing a vehicle for personal or business use and are unsure of the best way to finance it, read on to find out more about novated leasing and how it could save your business money and benefit your workforce.
A novated lease is one of the most cost-effective ways to finance a new or used vehicle. There are many benefits, including savings on GST and purchase price, servicing and more.
No matter the size of your business, you can offer salary packaging to your employees, where they finance a car via ‘salary sacrifice’. As an employer, you commit to paying for the lease and running costs through your employee’s annual pre and post-tax salary deductions.
There are a number of different finance products that can help people finance their vehicles. Two of the most common ones people opt for are a novated car lease or a car loan. Novated leasing allows the cost of the vehicle and associated running costs to be spread over an agreed term. This can improve your cash flow and help in other ways too with GST and income tax savings.
Directors, sole traders and self-employed small businesses
If you are employed by a business, even if you own that business, as long as you receive a wage and pay tax through the PAYG system, you may be eligible for a novated lease.
Small to large business owners
No matter the size of your business, you can offer salary packaging to your employees.
As a business, having the option to offer perks to your employees such as novated leasing can help set you apart from competitors. Offering salary packages can help you attract and retain employees, allow your business to enjoy tax-deductible payments and reduce payroll tax.
A novated lease lets employees choose the car they want, pay less tax, free up cash flow and save money in the process. One neat monthly payment can also help smooth their expenses and save on running costs. Plus, employees may also have the option to take the car with them if they change jobs, which means employers won’t be left to deal with the fallout if an employee leaves the business.
Set-up
After receiving a quote, you or your employee will select a vehicle and a ‘salary sacrifice’ novated lease is set up between employee, employer and Toyota Finance.Vehicle
Once the vehicle has been delivered, it is the employee’s responsibility to register the vehicle and organise insurance through a provider of their choice. We can recommend car insurance products through Toyota Finance.
Support
Alongside customer support and fringe benefit tax services, employees can get help with ongoing management including repairs, maintenance and roadside assistance.
End of lease
At the end of the novated lease period, employees can choose from the following options: extend the lease, buy the car outright or return it. They can also get another novated lease for a new car.
Our dedicated Toyota for Business support team is here to answer your questions and can discuss whether a novated lease is the best way to get behind the wheel of a new Toyota.
Disclaimer
This information provided is of a general nature and for information only. Nothing in this article constitutes or should be considered to constitute legal, taxation or financial advice. Before making a decision about any of the products and services featured on this article, you should consult with your own independent legal, taxation and financial advisors, who can advise you about your personal circumstances.