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Vehicle Salary Packaging

Packaging a motor vehicle via a Novated Lease continues to offer employees a tax effective means of leasing a vehicle of their choice as well as benefit from a range of savings including vehicle purchase price, service discounts and ‘whole of life’ costs.

Summit Fleet’s Novated Operating Lease and Novated Finance Lease packages have been designed around the effective Fully Maintained facility, with the exception of fuel and insurance – which is budgeted. This structure benefits both employers and employees of an organisation with access to a customisable and comprehensive service.

 

Your Ride? Your Rules!™

 

Novated Operating Lease

A novated operating lease provides flexibility and is attractive for those employees who do not want residual value obligations at the end of the lease. Summit Fleet takes on all the associated risks of ownership for the vehicle by registering it internally and providing the lessee possession of the vehicle.

Provided the vehicle is kept in the condition required in the agreement at the end of the lease, the lessee can return the vehicle to Summit Fleet without responsibility for any loss that may be incurred upon resale.

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Novated Finance Lease

When an employee decides to proceed with a Novated Finance Lease, the vehicle is registered in their name as well as most of the benefits and risks associated with the private purchase of a vehicle. Summit Fleet retains legal title to the vehicle and at lease end the employee is responsible for payment of the residual value, plus GST – this includes any shortfall between the actual vehicle sale price and the agreed residual value on the lease.

Residual values are set to the Australian Tax Office minimum values depending on the term of the lease and the residual value plus GST must be paid to Summit Fleet at the end of the lease.

Lease Term Residual Values
12 months 65.63%
24 months 56.25%
36 months 46.88%
48 months 37.50%
60 months 28.13%

 

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Important Changes to FBT

Since 2011, the Government reformed the previous ‘Statutory Formula’ method for determining the taxable value of car fringe benefits, now to record a single rate of 20 per cent that applies regardless of the distance travelled. See the Statutory Formula Transition for further detail and breakdown of these changes.