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A: A novated lease is a three-way car finance agreement between you, your employer and Alliance Leasing. It enables to you to bundle all your car running costs into one regular ongoing tax effective payment. By doing this you can reduce your taxable income, pay less tax and receive significantly more money in your pocket.
A: Traditionally, you earn a salary, pay income tax and then pay for all the costs of your car with the remaining money, also known as post-tax income. A novated lease allows you to pay for all the costs of your car with both pre and post-tax income.
A: With a novated lease you can include the following costs;
A: There are a few items in which you cannot include in your novated lease
A: No, the vehicle can be used for 100% private use with no requirement to keep a logbook.
A: A residual, or balloon payment as its sometimes called, is an amount that is outstanding at the conclusion of the lease term. It is a percentage set by the ATO to reflect the value of the vehicle at that time. It is designed to be a neutral cost.
There are several options available to you at the end of the lease:
A: We don’t strictly monitor the kilometres you drive, but we do use your predicted kilometres to budget your running costs. If there is a change to your usage, we will liaise with you to ensure your budgets are not compromised.
A: We understand that vehicle usage can fluctuate month to month and that it isn’t always possible to predict the vehicle usage for the life of the lease. Alliance Leasing proactively monitors your budgets and if there is a matter requiring your attention we will contact you.
A: Yes, and we can even help! Alliance Leasing can source heavily discounted vehicle pricing on all makes and models through our nationwide dealer network. This convenient service is free of charge. However, if you would prefer to source your own vehicle that is absolutely fine!
A: On a novated lease, the vehicle must be classified as a ‘car’ by the ATO. Motor cycles, boats, trucks and some utilities are excluded.
A: No, you can also lease used cars through a dealer or private sale. Typically, cars up to 12 years of age at the conclusion of the lease term are acceptable. Please remember if you do elect to purchase through a private sale, the GST savings on the purchase price are no applicable.
A: Yes, you can! Alliance Leasing can refinance an existing finance arrangement into a novated lease. You can even lease a vehicle you currently own through our sale and lease back option.
A: In accordance with the ATO, trade ins or lump sums cannot be used to reduce the purchase price of the vehicle. The tax benefits are intended for the use of the car rather than the acquisition of an asset. So you can trade in your current vehicle for cash separate from the lease, this way you avoid tying up cash in a depreciating asset and have an opportunity to use those funds in something more profitable!
A: Providing the new employer accommodates Novated Leasing as a staff benefit, we can assist with the transfer of your lease to the new employer. If the new employer does not offer novated leasing, then the lease would simply revert to a finance only arrangement whereby you pay the finance payments yourself using post tax income, much like a standard car loan.
A: FBT is a charge incurred by your employer associated with the provision of benefits which are additional to standard salary. Novated leases are considered such a benefit. To alleviate any FBT liability to the employer, Alliance Leasing uses the employee contribution method (ECM).
ECM
means that a portion of your lease costs are collected for your salary after PAYG income tax is applied. This post tax contribution offsets any potential FBT cost to your employer and makes the whole concept possible
A: With vehicles purchased through a dealer, 10% of this purchase amount is GST. This amount is excluded from your finance and not paid by you.
Depending on the policy of your employers, you can also save 10% on all running costs as your employer pays and claims this on your behalf.
A: The finance is in your name. The vehicle is registered to you. The responsibly for operating and maintaining the vehicle is yours, this includes insurance. Alliance Leasing is there to help every step of the way.
A: Yes, the car is registered to you in your name. As such all relevant renewal notifications will be sent directly to you by the relevant authorities.
A: Alliance Leasing can arrange comprehensive insurance and facilitate budgeting for self-sourced insurance premiums. Please be aware that ultimately it is your responsibility to ensure the car is insured at all times.
A: Yes, absolutely. Alliance Leasing can arrange a policy for you in house as a matter of convenience. However, you are certainly free to choose your own provider and we will package those costs in your novated lease.
A: Jake Lee is GT’s claims specialist dedicated to handle all claims from Alliance Leasing’s drivers, if you are involved in an accident either complete the Alliance Leasing Claim Form and email Jake at jake.lee@gtins.com.au or he can be contacted on (07) 3106 7718. Quote Alliance Leasing and your policy number which is CPG20206919.
A: Because the vehicle is registered in your name, the renewals will be sent directly to you. If you have sourced your own comprehensive insurance, any renewals will also be sent directly to you. To ensure they are paid on time, please forward all renewals to Alliance Leasing 14 days prior to their due date.
A: Yes, subject to approval it is possible to lease multiple vehicles on the same salary. So you can salary package a car for your partner or family members as well as yourself.
A: Alliance Leasing can provide Caltex, Shell and BP fuel cards. If you need to fill up an alternative provider, we can reimburse those costs for you within two days via our online portal.
A: Alliance Leasing has partnerships with a number of reputable providers across the country where you can access fleet discounts on servicing, tyres and labour. Please refer to your Glove Box Guide for further information. If you would prefer to choose a supplier of your choice that is perfectly fine. Please advise the service centre that the car is under lease with Alliance Leasing and to call 1300 225 582 for authorisation and payment.
A: At the conclusion of the lease, any surplus funds are returned to you via your employer’s payroll.