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What is Novated lease and salary packaging
Automotive Lease Packaging offer expert estimates via our professional novated lease calculator
A lot of people are unaware of how beneficial a novated lease can be, or are unaware of what a Novated Lease even is. However most working Australians have heard the term ‘salary packaging’ or ‘salary sacrificing’. These are alternative terms to explain what a novated lease is.
A novated lease salary package deal is an agreement between the employee, their employer and an independent car dealer whom sells a vehicle to the employer on behalf of the employee. The employee then makes regular repayments to the employer via deductions from their salary hence the term ‘salary sacrificing’.
In actual fact, it is not a sacrifice and the term often frightens people away from the car finance scheme. Novated leases are the best way to finance the acquisition of your new car as you can make repayments at a rate that you and your employer have agreed upon- not a bank.
Your overall salary will be impacted only minimally, and overall you will be taxed less as the scheduled repayments are deducted before tax so technically you have less taxable income over the period of repayment thus you will be taxed less, saving you money.
You can calculate the amount you will save by using the novated lease calculator provided by Automotive Lease Packaging. Our Australian novated lease calculator offers accurate estimates on the amount you can expect to pay and save by opting for a novated lease salary package.
For more information or to obtain you vehicle finance visit our Novated Lease calculator today!
Car finance Australia
For the best in car finance advice speak to the experts at ALP
Automotive Lease Packaging is the number 1 choice in Australia for new car finance and Novated Lease options. Use our car lease calculator online or give us a call to find out more information. We are the best option for car lease finance in Australia.
Automotive Lease Packaging are experts in car finance. Australia wide our customers are purchasing vehicles from authorised dealers and making scheduled repayments at a percentage appropriate to their wages thanks to the professional advice and guidance from our car lease finance specialists.
If you’re employed full time in Australia, you might be eligible for a novated lease package to finance your new car. New car finance is what ALP does best, and we pride ourselves on providing Australia with car finance at an affordable repayment rate.
Car finance in Melbourne can be difficult to attain from big banks, and if achieved can ask for unrealistic repayment amount. Organising your car lease finance through Automotive Lease Packaging means your employer and the vehicle dealer make an agreement on the purchase of a vehicle and then you, as the employee, have repayment amounts deducted from your wages at an amount you can afford.
Car finance Australia wide is now more easily attainable thanks to the novated lease programs and agreements entered into with ALP.
For expert financial advice contact Automotive Lease Packaging to discuss your new car finance options or to organise your car lease finances.
What is a Novated lease and salary packaging?
Why choose Novated Lease? Finance your new vehicle with a novated lease and notice the financial benefits
Why choose Novated Lease? Purchasing a new car via a novated lease is one of the most affordable avenues to take when organising your vehicle finance. A Novated Lease is an agreement between three individual parties: The purchaser who is a full time Australian employee, their employer and an independent car dealer.
Novated Leases in Australia operate on an agreed repayment schedule whereby the employer purchases the vehicle from the car dealer on behalf of the employee, who then makes regular repayments to the employer in the way of direct deductions form their wages. This is an innovative way of financing a vehicle in that the vehicle owner is in no debt to the car dealership and instead owes their employer. The agreed percentage is then withdrawn from their weekly wage.
Novated leases act as a security platform for car dealers, as they are paid in full by the employer, and act as a buffer for the employee as their repayments are scheduled to come direct from their wage so they’re never in risk of missing a repayment.
Novated Leases are the most financially responsible way to purchase a car through your employer, as they offer car finance at a rate that is affordable to you.
If you are still asking yourself ‘what is a novated lease?’ For further advice or information on novated leases in Australia contact Automotive Lease Packaging for expert guidance through your next novated lease. You can also use our car lease calculator to easily work out your monthly repayments or visit the finance lease or operating lease page for further information.
Looking for a particular make of car? Why not try a Holden Novated Lease, Ford Novated Lease or Toyota Novated Lease?
5 Steps to novated lease success
A novated lease is the most cost effective way for Australian employees to purchase new motor vehicles. By using the financing from an external financier, as well as your employer, you can acquire a car at a noticeably less overall amount by the end of the lease term. By acquiring the car through your employer and then paying back the owing repayments on a regular schedule deducted from your wages, you are never in danger of missing a repayment and you will save money on your tax as you are salary sacrificing. Novated Leases Australia wide are gaining popularity because of their financial affordability.
Organising a Novated Lease is a simple and stress free procedure when you’re organised and prepared. Here are the five simple steps to ensuring you achieve novated lease success:
1. Contractual availability/ Employer abilities
Make sure your employment contract allows for salary sacrificing so you can begin to negotiate a novated lease with your boss Also, make sure your place of employment offers employee packages and benefits such as novated lease salary sacrificing as not all companies allow it.
2. Find an appropriate financer/dealership
Once you have established your eligibility to acquire a Novated Lease in Melbourne, or any other Australian city, you will need to embark on finding an objective third party car dealership or financer to partake in the all-important car financing role.
3. Decide on an appropriate vehicle
Just because you’re getting financial participation from a third party, does not mean your car is free. A lot of people get confused under the notion they’re not paying for the car under a novated lease because it’s their ‘work car’ however, you’re making the repayments so make sure you pick a car within your budget- not a Ferrari!
4. Confirm your chosen vehicle is affordable and financially bankable
Using a simple Novated Lease calculator is a great way to establish whether the car you have chosen to purchase is viable for your budget. You may pick a vehicle you think is appropriate, however with the payments being deducted from your wage, you need to ensure you can still budget for other things.
5. Ensure you make a budget
The best way to ensure you will be able to afford a novated lease is to look at your lifestyle and financial requirements. If you cannot afford to be missing a percentage from your fortnightly wages for your car repayment because you have other financial responsibilities, holding off on a novated lease agreement is a good idea.
Novated Leases are a fantastic and very viable way to purchase a new car. Full time Australian employees can find many financial benefits including tax reductions by entering into a novated lease agreement, however ensuring the purchase of your new car will not interfere with other financial obligations is important as you will have your fortnightly wages automatically deducted to make repayments. This is a fantastic way to ensure you’re never behind on your repayments, thus avoiding incurring late fees, however sticking to a budget is vital.
10 Tips for Saving on Fuel Costs
As we become more and more concerned with rising fuel prices and carbon emissions in the modern age, it is becoming increasingly important to pay close attention to our vehicle’s fuel consumption. The good news is that we don’t always have to upgrade to a new car model to improve our fuel efficiency levels – it can be as simple as applying a few key changes to our driving habits and the maintenance of our vehicles. Improving your cars fuel efficiency and looking after maintenance will leave you more money for other motoring costs like car leases.
1. Drive Smoothly
An obvious one, but something which a lot of drivers rarely adhere to, is driving smoothly. Stopping and starting your care suddenly wastes more fuel and puts wear onto your car and should be avoided at all costs. Accelerating is the big one for fuel consumption, so avoid erratic increases in speed by keeping a safe distance from other cars at all times.
2. Minimise vehicle use
Trips under 5km generally don’t allow the engine to warm up properly, which leads to inefficient fuel outputs. Your engine uses the most fuel when it starts up before it reaches optimal temperature, so avoid trips that won’t allow you to achieve this. Riding your bike or doing all your errands in one trip will assist you to address this tip.
3. Drive in the right gear
One for manual drivers, it’s bad for fuel consumption if you let your car rev high in low gears. Change gears as soon as the car reaches comfortable revs and don’t let it get too high up hills or on corners. Automatic cars can also benefit by smoothly accelerating to avoid quick gear changes and high revs.
4. Minimise wind drag
Having your window open or items on your roof racks causes wind drag on your vehicle, slowing it down and using more fuel. This isn’t a massive drainer, but should be avoided if possible.
5. Avoid idling
Idling is unnecessary and wastes fuel. Most cars don’t need to warm up before driving, so doing this simply drains fuel as the car struggles to reach optimum temperature. Idling at traffic lights or lengthy stops should be avoided if possible – if you know you are going to be stopped for an extended period, turn your vehicle off.
Your car uses a lot more fuel over 90km/h so avoid hitting high speeds when driving. Using cruise control will assist you to achieve this, and will ensure you aren’t excessively accelerating and slowing down at high speeds.
7. Look after your tires
Ensure your tires are at the manufacturer recommended pressure and that they are properly aligned to avoid lethargic driving patterns. This will also have positive effects on your tyres use life and car handling
8. Travel light
Excessive amounts of luggage will lead to more weight in the car and more weight equates to higher fuel consumption.
9. Use the air-con sparingly
Air conditioning uses about 10 per cent extra fuel when operating, so avoid it especially at low speeds. On the other hand, using the air con at speeds over 80km/h is more fuel efficient than having the window open.
10. Keep your vehicle in good condition
Regular services and maintenance is vital for good fuel efficiency. A well tuned vehicle is the best way to go about lower your fuel consumption!
If you are looking to improve your fuel consumption, follow these steps and you’ll go a long way to saving. Another way to save on car costs is by using ALP’s car lease calculator. We offer Australia’s best car lease packages through allowing our customers to calculate their financial outlay online. Use our car lease calculator to determine your finances today!
We can also tailor a novated lease package that works for you. Use our novated lease calculator tool to easily work out your monthly repayments. We are also the fleet management Melbourne experts. Give us a call today!
New Car Buying Guide: Tips & Advice
Buying a new car is a costly albeit rewarding purchase. Whether you are buying it for personal use or for a work-related investment, chances are you will need a little financial assistance to become the secure owner of your new vehicle, and the best way to make this happen through car finance Australia wide, there are many businesses that are willing and able to provide you with many car loan options but there are a few things you need to consider to find the best car finance option for you.
New car finance for your vehicle
You need to figure out if your car will be used for personal or predominantly business purposes. Car lease finance is a sensible approach if your car will be used for the latter. A car finance lease gives you the opportunity to use the vehicle immediately without having to pay a large deposit. The vehicle is then residually paid off in agreed sums by you to the employer. The best part is, at the end of the term lease, you have the option to refinance, sell or purchase the vehicle for the remaining value.
New car finance has some very good benefits – it won’t make a severe, noticeable dent in your bank balance, it allows you to buy a better car than you could otherwise afford, you can spread the cost of repayment over a long period of time, and you’ll know exactly how long you’ll be paying the loan for until it’s completed.
Great car finance Melbourne locals can rely on
To find the best car finance Melbourne locals consistently turn to, it is important that you research your options. Find out who your friends and family recommend is important in finding a solid, reliable company that ensures you will not be paying hidden fees or over-the-top interest rates. It is also vital to remember that you should commit yourself to a loan that you are confident you can repay. It may be nice to be able to drive around in a Porsche, but it won’t help you if you cannot repay the lease.
Why a Novated Lease can work for you
A lot of people are unaware of the benefits of entering into a novated lease, which is primarily because they are unfamiliar with what it actually is. Simply put, a novated lease is an agreement between three participants: a full time Australian employee, their employer and an objective third party financer.
A Novated Lease is an extremely viable and affordable way for an employee to acquire a new car, with significant financial benefits for all parties involved. If you haven’t got the immediate finances available to purchase a new car, you can still do so through your workplace should their policy allow it.
A novated lease allows your employer to acquire the car through the financer on your behalf, then you make regular repayments to your employer via automatic deductions from your wages. Entering into a novated lease in Australia is a secure way to finance a new vehicle, while still maintaining a regular wage packet. The benefits of this car finance scheme are varied; however all are very healthy financial wins for all parties.
A novated lease can work for you by not only resulting in a new vehicle, but you are also guaranteed the security of your finances by having the repayments automatically deducted from you wage. This means no risk of falling behind on your car payments which may result in repossession. The car is 100% yours, despite your employer purchasing it, and you will be making all the payments so at the end of the lease period you have a vehicle in your own name.
A good way to calculate how much your regular repayments will be is to use a novated lease calculator. A novated lease calculator can measure how much you earn against the cost of the vehicle to determine a percentage total to be deducted from your wages. This is a great way for people to work out how they will need to budget for the type of car they wish to purchase through their novated lease. By searching for the vehicle or model you have in mind you’re able to work out how much it will cost and how much you’ll be missing from your wages each pay period. Australia has a very fair system when it comes to vehicle finance through novated leasing, meaning it is possible for employees to acquire a new car that they otherwise may not have been able to afford.
Additionally, a novated lease sees you pay less overall tax on your wages. By deducting the car repayments prior to taxable income being received, the employee will have a lower taxable income rate meaning they pay less tax over the financial year/s across the repayment lease period. Essentially, a novated car can work for you by supplying you with the finances needed to purchase a car, guaranteed security of the repayments on that car as well as a lower financial tax payment each financial year that the novated lease is valid.
Novated leases are a fantastic way for Australian employees to acquire new cars without the financial burden associated with bank loans and other financial loans. If you need more information on what is a novated lease and novated lease explained we can provide you with all the info you need.
We are the experts in Australia for Ford Novated Leasing, Holden Novated Leasing and Toyota Novated Leasing. Give us a call today and one of our friendly staff will assist you.
How to Save Tax with a Novated Lease
Novated leases have become an increasingly popular way for employees to buy a new car, largely due to the amount of tax benefits involved. A novated lease is an agreement between an employer, employee and a vehicle financier. A novated lease also provides the employee with the means to salary sacrifice their income in order to pay for their car over a period of time.
Novated lease pre-tax benefits
It’s due to salary sacrificing that a number of novated lease tax benefits come to the fore. Because you’re paying for a vehicle in pre-tax dollars, you are able to enjoy a lower rate of tax. If you were paying for the vehicle another way, you’d be subjected to increased tax and therefore would end up paying more for the car. Ultimately, novated leases save you tax money.
Fringe Benefits Tax (FBT) for Novated Leases
Because Novated Leases are considered an employee benefit, users may be open to the Fringe Benefits Tax (FBT). Salary packaging involved in novated leasing is concessionally treated as a part of the Fringe Benefits Tax, making it a tax-effective way to buy a car.
If you are looking into a novated lease, the tax benefits on offer ensure that your choice will be a cost-effective one. When it comes to novated leasing, Automotive Lease Packaging are Australia’s number one professionals – our team of experts will be able to advise and guide you throughout the process with absolute efficiency.
If you have any more questions about novated lease tax benefits call 1300 309 343. You can also use the novated lease calculator provided by us.
Leasing a Car Vs Buying a Car
What’s better – leasing a car or buying a car? It’s a common dilemma that people face when looking to buy a car in Australia, and one that doesn’t necessarily have a simple answer. Whether you lease a car or buy a car is dependent on your personal financial situation and preferences. Each has their pros and cons, meaning that you need to determine which one suits you best when heading into the negotiation process.
Lease Car Options
When you lease a car you only have to pay a part of the car’s total cost. This is considered the part that you ‘use’ during the period that you are driving the vehicle. When choosing to lease a car you will:
Not have to make a down payment
Pay sales tax only on your monthly repayments
Pay a financial rate
Possibly have to pay a security deposit
At the end of the lease you have the option to return the car or purchase it for its depreciated resale amount. Novated leasing is a common way to lease a car.
Buying a Car
When you buy a car, you pay for the entire cost of the vehicle either upfront or as a part of a loan. Monthly payments tend to be higher when you buy a car. Once you have paid off your loan, you have complete ownership of the car and can sell it for its resale value or keep it and continue to use it.
When it comes to car leasing and financing, Automotive Lease Packaging are the ones to turn to. Whether you are looking to a lease a car or buy a car in Australia, our expert team will be able to assist. Enquire more on 1300 309 343.
Car Financing for First time Car Buyers
Things you will need to know before making this investment
Buying a car will inevitably be one of the biggest purchases you make in your life, so you’ll need to be properly prepared and well-versed in the field before you make any financial commitments. If you are in the market for a car and this will be your first vehicle purchase, congratulations! However, there are many things to consider. The most important thing to consider is how you will fund the vehicle. Car financing for first time car buyers is always a big step, and can be confusing if you don’t know what you’re doing. Automotive Lease Packaging can assist by steering you in the right direction when financing your first car.
To find out if you are eligible for car financing from Automotive Lease Packaging, take into consideration the three C’s – Collateral, Capacity, and Character.
Collateral refers to the vehicle under consideration for the loan
Capacity refers to your ability to repay the debt
Character refers to your credit history
Automotive Lease Packaging – the smart way to finance your first vehicle
Maximise your vehicle benefits and save thousands of dollars with our specialised finance products that are tailored to your budget and needs. If you would like more information regarding car financing for first time car buyers, call Automotive Lease Packaging today. We are happy to offer you advice and assistance to help you buy your dream car.
How Car Finance Works
The safest and smartest way to finance your car is with a novated lease
If you are in the market for a new car, there are many different ways to pay for it. However, if you don’t have the cash lying around, or a generous family member willing to lend you the money, you will inevitably have to take out a car loan. If you dread the thought of getting a loan from the bank, there is another great solution that millions of Australians before you have undertaken – it’s called a novated lease, and it’s one of the smartest and financially secure ways to own your dream car.
The process for how car finance works through a novated lease is simple: when you choose to go through Automotive Lease Packaging, you are entering a financially binding contract between your employer and a registered car dealership of your choice, with ALP acting as your financier. Firstly, you will need to fill out an application form that requires information such as your personal details, employment details, monthly expenses and monthly income. Then, using our car finance calculator, we agree on a repayment structure based on the term, interest rate, amount borrowed, and the residual payment.
There are many benefits to a novated lease, such as having tax savings and a regular payment structure that enables you to never miss a payment or be out of debt. If you would like more information about how car finance works, call Automotive Lease Packaging today.