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Novated Lease - Residual value & COVID-19

Newbie

Views 732

Replies 1

Late last year I negotiated a new vehicle and left a deposit. The build of the car is Feb 2020 for arrival to Australia April 2020, giving me time to explore a novated lease option. Thanks to COVID, car still at port and now super confused.
I’m concerned if I go down the novated lease path that my residual value will be greater than what I could potentially sell the car for and or option to return car to leasing company which comes at a cost. Concerned due to COVID-19 impacting the automotive industry on an international value. Leasing companies interest are extremely high compared to banks, some banks offer a very low interest rate and then I own it.
What should I do? Never done a novated lease either and feel I am taking a large risk as there will not be enough of a tax benefit compared to value of car in four years time.
Feedback please on pros, cons and risk. What would you do?
1 ACCEPTED SOLUTION

Accepted Solutions

Most helpful response

Community Moderator

Replies 0

Hi @Mia007

 

Thanks for your post.

 

We recommend that you seek professional advice about this one. We can't advise which option is best for you as it depends on what you are trying to achieve.

 

If you would like to do some reading about novated leases on our website, you can check out the GST and vehicles purchased under novated leases page.

 

There are also a number of threads about novated leases in our Community. Here are a couple of them:

 

Hope this helps. Good luck with it.

 

Thanks, ChrisR

1 REPLY 1

Most helpful response

Community Moderator

Replies 0

Hi @Mia007

 

Thanks for your post.

 

We recommend that you seek professional advice about this one. We can't advise which option is best for you as it depends on what you are trying to achieve.

 

If you would like to do some reading about novated leases on our website, you can check out the GST and vehicles purchased under novated leases page.

 

There are also a number of threads about novated leases in our Community. Here are a couple of them:

 

Hope this helps. Good luck with it.

 

Thanks, ChrisR