The novated lease has emerged as a common car financing
solution for many employees across Australia. It’s an easy, flexible,
and convenient way to access a car through utilising the tax benefits
associated with salary packaging. How it works is simple; you can lease a
car of your choice, and your employer agrees to pay the rentals and
other applicable running costs directly from your salary package. It’s
beneficial and advantageous in many ways, making it a popular choice for
many.
While novated leasing is common practice, there are many misconceptions about it. Here are some of the more common myths.
Novated Leases are Exclusively for High Income Employees
One of the biggest misconceptions is that this type of financing is only possible if you earn within a high income bracket. Although it’s true that some will save more than others, a novated lease will work for employees whose salaries fall within a lower bracket too. You can benefit from the various savings and benefits offered by a plan that consolidates vehicle expenses and reduces taxable income.
Novated Leases Have an Age Bar
The age bar is one of the most common myths associated with novation. Interestingly enough, there’s really no evidence to support the claim. The truth is you can apply for a novated lease as long as you are in full time employment, have a current driver’s license and your employer allows you to participate in salary packaging. Novated leases are also transferable to new employers, meaning it is available to you even if you change jobs.
Novated Leases Require you to Get a Brand New Car
This is perhaps the biggest and most common misconception about novated leases – that the car you get must be brand new. Second hand cars are acceptable as long as it doesn’t exceed twelve years of age by the time the lease ends. There are also special cases where a car older might be acceptable, it’s always best to work out the details with expert advice.
Misinformation can prevent you from buying the car you’ve been dreaming of. Roche Finance hopes to address these misconceptions so you can get started on the process. Click here to learn more about novated leasing and how Roche Finance can help.
While novated leasing is common practice, there are many misconceptions about it. Here are some of the more common myths.
Novated Leases are Exclusively for High Income Employees
One of the biggest misconceptions is that this type of financing is only possible if you earn within a high income bracket. Although it’s true that some will save more than others, a novated lease will work for employees whose salaries fall within a lower bracket too. You can benefit from the various savings and benefits offered by a plan that consolidates vehicle expenses and reduces taxable income.
Novated Leases Have an Age Bar
The age bar is one of the most common myths associated with novation. Interestingly enough, there’s really no evidence to support the claim. The truth is you can apply for a novated lease as long as you are in full time employment, have a current driver’s license and your employer allows you to participate in salary packaging. Novated leases are also transferable to new employers, meaning it is available to you even if you change jobs.
Novated Leases Require you to Get a Brand New Car
This is perhaps the biggest and most common misconception about novated leases – that the car you get must be brand new. Second hand cars are acceptable as long as it doesn’t exceed twelve years of age by the time the lease ends. There are also special cases where a car older might be acceptable, it’s always best to work out the details with expert advice.
Misinformation can prevent you from buying the car you’ve been dreaming of. Roche Finance hopes to address these misconceptions so you can get started on the process. Click here to learn more about novated leasing and how Roche Finance can help.
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