Benefits Of Novated Leasing

Here are some key advantages:

For Employees:

Tax Savings:

One of the primary benefits is the potential for tax savings. Novated leases allow employees to use

pre-tax income to pay for the lease, reducing their taxable income.

Cost Savings:

Employees can benefit from potential discounts on the purchase price of the vehicle, as novated

leasing often involves bulk purchasing by the leasing company.

Flexible Vehicle Choice:

Employees have the flexibility to choose the vehicle that best suits their needs, within the guidelines

set by the novated leasing provider.

Bundled Expenses:

Novated leases often include vehicle-related expenses such as fuel, maintenance, and insurance,

simplifying budgeting for employees.

Ownership Options:

At the end of the lease term, employees may have the option to purchase the vehicle, enter into a

new lease agreement or refinance the balloon and stay in the current vehicle for a determined

period.

For Employers:

Employee Attraction and Retention:

Offering novated leasing as a benefit can enhance the overall compensation package, making the

company more attractive to potential employees and aiding in talent retention.

Minimal Administration:

The administrative burden on employers is generally lower with novated leasing, as many

administrative tasks are handled by the leasing provider.

No Residual Risk:

Unlike traditional vehicle ownership or financing arrangements, novated leasing transfers the

residual value risk to the employee or the leasing company, removing this responsibility from the

employer.

Flexible Benefit Provision:

Novated leasing allows employers to provide a valuable benefit without significant financial outlay,

as the costs are primarily borne by the employee through salary packaging.

Enhanced Employee Well-being:

Providing employees with the opportunity to access novated leasing can contribute to a positive

work environment and employee well-being, as it aligns with the evolving expectations of a modern

workforce.

Positive Corporate Image:

Offering innovative and employee-friendly benefits like novated leasing can enhance the company’s

reputation and contribute to a positive corporate image.

For Both:

Transparency:

Novated leasing is transparent, with clear breakdowns of costs and responsibilities. This

transparency benefits both employees and employers, fostering a more trusting relationship.

Personalisation:

Novated leasing arrangements can be personalised to meet the specific needs of employees,

providing a level of flexibility that traditional company car schemes may not offer.

Maintenance and Management Support:

Many novated leasing providers offer comprehensive maintenance and management services,

reducing the hassle for both employees and employers.

In summary, novated leasing in Australia presents a win-win situation for employees and employers,

offering financial advantages, flexibility, and a streamlined approach to vehicle ownership and usage.