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Novated Lease Question

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Newbie

Views 409

Replies 2

Hi,

I have a specific question about novated lease.

I am trying to arrange a novated lease myself with a bank rather than with my company provided lease provider.

As the lease provider charges more interest which i am not ready to pay as it dilutes all the benefits of novated lease as an employee.

 

So bank is ready to provide novated lease for the cost of the vehicle say 35,000 like a car finance at a specific interest rate. So i get 1) the GST benefits on the cost of the car through input tax credits

2) pre tax contribution through my salary sacrifice.

3) but the question is how to get the FBT benefits of post tax contributions.

If i go with my company provided lease provider they package all the finance cost and run cost together and they give a claim process fo fuel, insurance, rego etc.

But since i want to lease directly through a bank not with the lease provider. So i am confused how to get the FBT refund through year end tax lodgement. As my employer will take the FBT i suppose ?

I think FBT would cost around 3500 per year approximately on a higher end and my pre tax benefits through salary sacrifice would be around the same. So i am confused for a situation like mine does novated lease even works if i dont want to go with company provided lease provider wo charges incredibly high interest rates and so many fees and charges.

 

Please help...

 

Siva

1 ACCEPTED SOLUTION

Accepted Solutions
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Best answer

Community Manager

Replies 0

HI @Sivukumar,


Thanks for your patience.


The FBT liability arising from the provision of the car under the lease arrangement will rest with the employer, who will normally recover the liability from you  depending on the terms of the agreement between you.


 We can't provide advice about whether novated leasing will work effectively for you financially, as this advice can only be provided by a financial advisor.

 

We would suggest contacting the early engagement area if you need more specific information and where you will be able to provide my details.

 

Thanks

 

KylieS

 

 

 

 

2 REPLIES 2
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Community Manager

Replies 0

Hi @sivahumar,

 

We will look into this one for you.

 

Thanks

 

KylieS

Highlighted

Best answer

Community Manager

Replies 0

HI @Sivukumar,


Thanks for your patience.


The FBT liability arising from the provision of the car under the lease arrangement will rest with the employer, who will normally recover the liability from you  depending on the terms of the agreement between you.


 We can't provide advice about whether novated leasing will work effectively for you financially, as this advice can only be provided by a financial advisor.

 

We would suggest contacting the early engagement area if you need more specific information and where you will be able to provide my details.

 

Thanks

 

KylieS