A novated lease is calculated by considering several factors: the lease term, the car's price, the residual value at the end of the lease as set by the Australian Taxation Office (ATO), running costs (fuel, maintenance, insurance, registration), and the interest rate. A novated lease calculator can simplify this process by automating the calculations, allowing you to adjust variables to see how different scenarios affect your payments.

Yes, you can save money with a novated lease, primarily through pre-tax salary deductions, which reduce your taxable income on the purchase price and running costs of the car. However, the actual savings can vary based on your salary, the car you choose, and your personal circumstances. Using a novated lease calculator can help estimate these savings more accurately.

Novated leases can be worth the money for individuals who prefer a new or late-model car and would like to bundle their vehicle expenses into one regular payment. The value also comes from tax benefits. However, it's essential to consider personal financial situations and compare other car financing options.

Salary sacrificing a car through a novated lease can be worth it if the tax savings from reducing your taxable income outweigh the costs associated with the lease and running the vehicle. It's a convenient way to finance a car and manage expenses, but it's crucial to evaluate if the benefits align with your financial goals and lifestyle.

FBT on a novated lease is calculated using two methods: the statutory formula method and the operating cost method. The statutory formula method applies a set percentage (20% since the 2011-2012 financial year) to the car's base value, while the operating cost method calculates the FBT based on the actual expenses of the car and the proportion of private use. Employers typically choose the method that results in the lowest FBT liability.

The process involves:

• Vehicle selection

• Completion of a credit application

• Signing lease documents and providing necessary verification

• Coordination with the employer for onboarding

• Financer contract settlement and vehicle handover

A novated lease can be taken out for a period of between 1 to 5 years.

When your novated lease ends, you’ll have the option to upgrade to a new vehicle with a new novated lease. extend your lease with the same vehicle or pay the residual amount to own the car outright.