www.smartsalary.com.au

They have a calculator on there... check it out

www.smartsalary.com.au

They have a calculator on there... check it out

cheers mate

My fully maintained novated lease on a new XR6T (with some optional extras but with attractive fleet discount) is costing me close to $1500 a month. This covers the lease of about $700, plus ALL running costs, and employee contribution to offset the expected FBT. I'm salary packaging the total from my pretax income over 5 years, and the resulting net cost to me is about $880 a month. Including lease and all running costs.

After quite a bit of research and quote investigation, this ended up being a great deal for me, as it was what I was looking at paying for a secondhand car of less than 3 years of age. You can't get fleet discounts on used cars and, of course, there's the 'hassle' of it being used and coming with an unknown history. It might be out of warranty too. And so on. It made sense to go down the new path when the overall benefit was going to be better than having a used car for the same price...

Edited July 24, 200719 yr by AlanzEyes

Tax benefits Daniel will vary depending on your work and what your car is used for.

I have a sales role, meaning I use my car to get to clients etc. I claim a percentage of all my car costs because I use my car for work.

That said, if you have buy a car and you only use it for personal use, leasing the car will have zero tax benefits.

Residual is the amount owing at the expiration of the lease period.

eg: You buy a $45K car on a 3 year, 35% lease, at the end the payout figure will be $15,750.

This is DEFINATELY NOT true.

There are different methods of working out your FBT liability and one of those is purely based on how many K's you do each year. If you do more than 25,000km's per year it can be tax effective, particularly if salary sacrificing for expenses as well as lease payments. You can also negate your FBT liability by paying some expenses out of your post tax dollars, which leaves you better off at the end of FBT year.

This is DEFINATELY NOT true.

There are different methods of working out your FBT liability and one of those is purely based on how many K's you do each year. If you do more than 25,000km's per year it can be tax effective, particularly if salary sacrificing for expenses as well as lease payments. You can also negate your FBT liability by paying some expenses out of your post tax dollars, which leaves you better off at the end of FBT year.

Phil,

What I have said is not wrong at all.

If you lease or HP a motor vehicle and aim to reduce your tax liability, you need to demonstate that the vehicle expenses were incurred as part of your job.

If not, there is no advantage to a HP or lease - you might as well get a personal loan.

What you have said is right too assuming your employer is happy to get involved in salary sacrificing and/or novated leases, however there are other issues to then consider such as what happens if you leave your job, FBT, GST etc

I have been leasing cars for 20 years, and while not an expert on finance by any means, CHP's have always worked well for me.

My 2 cents

Works out good if you work for an organisation that can get government fleet pricing. Hence you can get a brand new BF XR6T for 32k on road.

I looked at this a few months ago and in some ways it is good but in other it is not so good. In my case it would cost me about $1000/month to get a full maintenance lease for 4 years, this includes all running costs etc.

I opted to wait for the Orion to come out because I know that I would regret the fact that I am tied in for 4 years with a BF. You can go for a shorter term lease but then the lease payments are going to be more. Also the purchase price will determine what the residual is at the end of the lease. On a 48 month lease the residual is 37.5% of the purchase price (32k). You don’t pay GST when you buy the car but you have to add GST to the residual so the total residual is about 13k.

So at the end of the day if you do the maths, the 48 month lease will cost me 48k and at the end of it I can sell the car and make a profit and offset that against the total outlay over the 48 months. But at the end of the day I would still be 40k out of pocket and have no car after 4 years.

Either way cars cost you big bucks and you need something to offset the loss you make on cars, such as houses.

I went with SmartSalary with my lease, this is through Defence so all GST is refunded back to me. It covers everything to do with the car - Maintenance, Rego, Insurance, Fuel, Cleaning, Tyres... I owed a fair bit on my car with finance, but the amount I organised through SmartSalary left me with $5000 in my pocket (I owed 21k, the amount I financed for the lease was 26k)... so it meant I could use that money elsewhere. The residual after 2 years on mine is just under 13k, and I'm sure I'll be able to sell it for 19-20k at the end of the lease... so I'm clear at least 10k at the end if I sell it. I also have the option to renew the lease but the payments have to be worked out from scratch on the residual amount. I estimated I would be doing more than 30000km per FBT year, which I am easily clearing (I broke into the lower tax bracket last year, so I got more back!) so the more km you do the more you benefit. I think I'm paying about 625 a month for my lease... plus fees which are minimal.