Retain key staff without having to pay them more

Many local companies are attracting and holding key staff by offering salary packaging for motor vehicles. Used for business or personal use you are offering them the ability to make payments in pre-tax dollars potentially saving thousands of dollars annually.

Novated leasing has become an increasingly popular form of vehicle financing over recent years. A novated lease combines many features of more traditional forms of vehicle finance to deliver some attractive benefits for both employers and employees.

A novated lease is an agreement between your employer, yourself (the employee) and the financier. With a novated lease agreement, you own the vehicle and have the right to take it with you should you change jobs and, structured correctly, there may be tax advantages with your remuneration package. As with other leasing structures, repayments with a novated lease are flexible and amounts depend on the term, interest rate, amount borrowed and the residual payment.

Benefits to Employers:

– An employee is completely responsible for their own car. If they leave your company so does the car & lease agreement. You are not left with a vehicle or leasing you don't need. Company cars do not appear on the balance sheet as the
loan is in the employee's name, increasing the business' borrowing capacity.
– The company does not have to do FBT reporting on these vehicles.
– You may also be able to reduce payroll tax as well as workers compensation premiums & Superannuation contributions.

Benefits to Employees:

– You can make the lease payments out of pre-tax dollars (Salary Packaging) which reduces your taxable income.
– You do not require a deposit.
– At the end of the lease you can simply buy the car for its residual value, re-lease or trade it in on a new novated lease.
–  Fuel & maintenance costs can be packages the same way.
–  The vehicle may be leased for 100% private use.
–  More than one vehicle may be leased with employer consent.
–  Greater flexibility with the choice of a vehicle.

You do not have to be a large organisation to offer novated leasing to your employees. For more information contact Leasecorp Motor vehicle & Equipment Finance on (02) 4323 2678.

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