How Much Will a Novated Lease Save Me?

If you're thinking about getting a novated lease, you're probably wondering just how much it can save you. The great news is that a novated lease can offer substantial savings on both car ownership and running costs, while also providing significant tax benefits.

A novated lease is an arrangement where your employer deducts payments for your car directly from your pre-tax salary, reducing your taxable income. This means you pay less tax overall. Depending on your income and the cost of the vehicle, this tax-saving element alone can result in thousands of dollars in savings each year.

For example, if you're on a mid-to-high income, the tax savings from a novated lease can amount to up to 30% or more off the total cost of owning and running a car. That’s a major saving compared to traditional car finance or outright purchasing.

Additionally, a novated lease typically bundles car expenses like fuel, maintenance, registration, and insurance into one easy payment, all pre-tax. This can simplify budgeting and further reduce costs. You won’t have to deal with unexpected car bills popping up, as these are spread across the life of the lease, which helps manage your cash flow better.

Another key advantage of a novated lease is the ability to upgrade your vehicle more frequently. You can drive a new or nearly new car every few years without the hassle of selling the old one, and without needing a large upfront payment like you would with a standard car purchase.

However, the exact amount you will save depends on several factors, including your salary, the cost of the car, and your lease terms. That’s why it’s essential to speak with a novated lease provider who can help you calculate your specific savings.

Ready to find out how much a novated lease can save you? 

Contact Novated Finance Australia today for a free, personalised estimate, and start driving your dream car for less!