Novated Lease FAQ

What is a Novated Lease?

Novated Lease is a three way agreement between you, your employer and Endeavour Fleet. By entering into a Novated Lease you transfer the obligations of the lease to their employer. Your employer makes the lease payments to Endeavour Fleet, and collects this money back from you through salary sacrificing.

Who is eligible for a Novated Lease?

Novated Leases are available to full time employed employees. You will need to check with your employer whether they allow Novated leases for their employees. 

What are the advantages of a Novated Lease?

There are a number of advantages for both employee and employer.

Employee

  • Income Tax Savings – As your lease payment is coming from your pre-tax income you may be liable for less income tax

  • GST Savings – Because the financier claims the input tax credit, your total financed will be less GST saving you money. 

  • Vehicle Choice – The flexibility of choosing the vehicle you want to drive.  

  • Pricing – Endeavour Fleets dealer network are able to save you thousands. 

  • Fleet Management – Let Endeavour Fleets fleet management system take the hassle away from you.

Employer

  • Employee Benefits – By offering Novate leases you will keep your employees happy on the job.

  • Tax Advantage – Your employer may be able to claim the input tax credit from the lease payment.

  • Limited Vehicle Risks – By reducing company fleets reduces the risk and frees capital.

What car can I choose?

With a Novated lease you are able to choose the vehicle you want. Not what your employer wants you to drive. This flexibility is one of the main reasons Novated leasing is so popular. This is dependant on the employer’s vehicle policy.

What is FBT?

Fringe Benefit Tax (FBT) has been put in place to tax the benefits provided to employees by employers in replace of salary or wages. The most popular benefits are purchases used by salary sacrifice e.g. motor vehicles. In many cases your FBT liability will be less than your income tax saving. See our FBT section for more information.

What is employee contribution?

The Contribution Method gives employees a way to reduce their FBT liability by contributing to the running cost of the vehicle. For every after tax dollar that an employee contributes it reduces the FBT liability by one dollar. At Endeavour Fleet we will discuss your requirements and determine the right level of employee contribution.

How do I know how I’m tracking?

Endeavour fleet will send e-mail letting you know how you are tracking against your projected kilometres.

What happens if I spend more than budget?

If you start to spend more than budget, Endeavour Fleet will contact you and your employer to revise and or increase your before-tax payment. If at the end of your lease you have spent more than your budget Endeavour Fleet will invoice your employer for the shortfall and your employer will recover any funds from your salary.

What happens if I spend less than budget?

If at the end of your lease you have spent less than your budget, these funds will be returned to your employer for reconciliation.  Adjustments will be made and once PAYG tax is deducted, the balance is paid to you. 

What if I leave my employer?

If you cease employment with the company, your employer’s responsibility falls back on the employee. You can either:    

  • Pay the outstanding lease amount

  • Continue to pay the lease payments

  • Novate the lease with your new employer.
     

Contact Endeavour Fleet to discuss

 

 

What residual value will apply?

Endeavour Fleet set their residuals in accordance with the current ATO rulings. These rulings are the minimum residual values depending on the term chosen. The following table outlines the ATO minimums.

 

12 Month

65.50%

24 Month

56.25%

36 Month

47.00%

48 Month

37.50%

60 Month

28.25%

What happens at the end of the lease?

There are a number of different options you have once the residual value is due.

  • Sell your vehicle privately and pay the residual amount owing. You may need to add personal funds if you do not sell the vehicle for the required amount.

  • Re-finance the residual amount over a new term.

  • Trade your vehicle into a dealer and enter into a new Novated lease for a new vehicle.

  • Purchase the vehicle for the residual amount, taking ownership of the vehicle yourself.

Endeavour Fleet will help with which ever option suits you best. For advice please contact our office. 

What do I do now?

These easy steps will help you complete your Novated lease. If you need any help contact us and we will be happy to help.

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Novated Lease 

Call Us Now: (02) 9524 1233​​

Take advantage of the benefits available to you and your employer by entering into a Novated Lease.

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