Save thousands every year with a Novated Lease

Why would I do a Novated Lease?

Your Employer pays your car lease payments and running expenses with Pre-Tax dollars (usually 34.5% tax saving) and GST refunded (10%).

Therefore, you get the majority of your car expenses paid with a 44.5% discount.

 

Types of Novated Leases:
Traditional Novated Lease
  • Leasing a new or near new car from a finance company
  • Great option to access a new car with no up-front payments
  • Set payment schedule with pre-tax dollar advantages
  • Ability to payout and keep, refinance or sell the car at the end of lease
Associate (Novated) Lease
  • Has all of the same advantages as the Traditional Novated Lease, with the main difference being that you are Leasing from an Associate rather than finance company
  • The Employee has no finance on the car
  • The car can be new or existing and be any age without restriction
  • The Associate can purchase the car with any type of finance or no finance – therefore there is no requirement for a Residual/Balloon
  • Associate can be a family member or a trusted friend
  • The Associate must have an ABN
  • Your FAA portal/App provides direction on establishing the ABN for the Associate
  • The Associate must make a profit as a business with an ABN
Full Maintained Associate (Novated) Lease (FMAL)
  • Has all of the same advantages as the Traditional Novated Lease and Associate Lease, with the main difference being that the Associate pays for all car running expenses
  • The Employee has no finance on the car
  • The car can be new or existing and be any age without restriction
  • The Associate can purchase the car with any type of finance or no finance – therefore there is no requirement for a Residual/Balloon
  • Associate can be a family member or a trusted friend
  • The Associate must have an ABN
  • Your FAA portal/App provides direction on establishing the ABN for the Associate
  • The Associate must make a profit as a business with an ABN
  • The Post-Tax component is always reduced or can be totally eliminated if doing high kms
  • Because the majority of the Lease expenses are paid with Pre-Tax income, the savings are always going to be greater
  • We provide a separate Portal/App for the Associate to manage this lease and all associated tax considerations for when they do their Tax Return

FMAL leases typically outperform other leasing models

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Traditional Novated Lease

What is a Novated Lease?

A Novated Lease is an agreement between 4 parties to own and use a Car – the parties being:

  • Employee – You
  • Employer – the organisation you work for
  • Finance company – provides the finance for the car purchase or your existing car
  • Administrator – interface with each the Employee, Employer and the Finance Company

The Administrator facilitates:

  • All of your Tax Saving/Benefits
  • Car quotes for affordability including running cost
  • All documentation required
  • The flow of all monies
  • All online reporting for Employee
  • All online reporting for Employer

What are the benefits of a Novated Lease?
    • Turnkey and simple
    • You choose the car
    • Majority of expenses are paid with Pre-Tax monies (min 44.5% discount)
    • No upfront cost
    • All GST on expenses is refunded
    • You have unrestricted use and who can drive it
    • Even with low km’s, you will achieve considerable tax savings
    • Budgeted expenses:
      • are all-inclusive with Fixed Repayment
      • large expenses such as Rego or tyres – the money is there when it is due

Overview – how does your Novated Lease actually work?
  1. Complete the quote online which sets out/up all variables such as the car cost and running expenses for your Novated Lease
  2. Proceed to implement/checkout when happy with Tax Benefit quote
  3. Establish your FAA Salary Packaging account
  4. Download the FAA App
  5. Finance Application and approval will be obtained via the Portal/App: The finance term usually has 2 months upfront with no payments made to facilitate your FAA Salary Packaging Trust Acc the time to develop a surplus of funds for larger expenses
  6. Now choose your car, or you can decide to Lease your existing car
  7. All required documentation will be eSign and automatically generated for:
    • The purchase of your car (Note if a Financer requires an ink signature, print, sign and scan of this will be the only non-digital step)
    • Employer requirement to make deductions from your pay into your FAA Salary Packaging Trust Acc
    • Employee Participation Agreement
    • Any policy documents specified by your employer
    • Fuel cards ordered
  8. Pay deductions will commence
  9. Organise collecting your new car (If not packaging your existing car)
  10. As expenses arise:
    • Pay or claim reimbursement for these expenses from your FAA Salary Packaging Trust Acc
  11. Log onto your FAA portal/App to view all transactions or reporting you would like to see
  12. Increase or reduce your payroll deductions to in alignment with your actual cost via your App
  13. All necessary reporting will be provided to your Employer

Operating costs that can be packaged include:
  • Lease Repayments
  • Fuel, Oil and Radiator Coolant
  • Service and Maintenance
  • Replacements (eg: Tyres, Windows etc)
  • Damages or Repairs (Conditions Apply)
  • Registration (including transfer costs if any apply)
  • Comprehensive Insurance and excess payments
  • Other types of Insurance (eg: Tyre & Rim, Gap and more)
  • Roadside Assistance
  • Paint Protection
  • Rust Proofing (not removable)
  • Window Tinting
  • Car Washing and Detailing
  • Car Air Fresheners and Deodorisers
  • Protection for Fabric Interior (not removable)
  • Extended Warranty for Novated Lease Car
  • Excess on Insurance

Items that can NOT be packaged?
  • Parking fees
  • Tolls
  • Fines
  • Licences
  • After market goodies (not on the car at time of purchase) that are not replacing similar
    • Bull Bars
    • Tow Bars
    • Sound Systems
    • Mag Wheels (Unless replacement)
    • Tinting
    • Roof/Bike racks

Budget Variations
  • Your quoted running expenses are an estimate only
  • Your FAA App helps you track your costs and increase/decrease the amount of your Pre-Tax dollars you are diverting to meet your actual costs
  • Using the fuel card and in-App receipt capture automates the claiming process

Myth Busted: There is no minimum kms needed for Novated Leases and we can package cars of any age

Fuel Cards
  • Being able to use a Fuel Card is another great benefit of a Novated Lease.
  • To fill up with a Fuel Card, simply present your card at participating service stations to quickly and easily purchase fuel.
  • These cards are widely accepted and are an easy and quick way to purchase fuel.
  • Depending on your Employer, you may also be able to pay for your maintenance and services at participating organisations, and even tyres.
  • FAA provides a Fuel Card(s) which is used as a debit card at all fuel stations, where a Fuel Card is accepted.

End of finance lease options
  1. Lease ends and Lease another new car
    • Lease ceases – FAA look after this process
    • Trade or sell your Car privately however you chose to
    • From proceeds of sale, payout residual/balloon
    • Any surplus funds from the sale are yours to direct into your personal bank account
    • All funds in your account remain there for the new Lease
  2. Stop Leasing this car and sell the car
    • Lease ceases – FAA look after this process
    • Sell your Car privately however you chose to
    • From proceeds of sale, payout residual/balloon
    • Any surplus funds from the sale are yours to direct into your personal bank account
    • The funds in your Salary Packaging account will be reversed back through your Employers payroll or can be used for any other benefit you are packaging such as into your Superannuation provided you are not going to exceed your Cap
  3. Release the car – seamless transition
    • Refinance the residual/balloon
    • A new Lease is put in place
    • As the new refinance amount is lower, your new lease deductions will be much lower
    • All funds in your account remain there for the Lease to continue
  4. Stop Leasing and keep the car
    • Cease leasing
    • Payout the residual/balloon of the loan with personal funds
    • The funds in your Salary Packaging account will be reversed back through your Employers payroll or can be used for any other benefit you are packaging such as into your Superannuation provided you are not going to exceed your Cap
    • Registration is in your name so nothing else changes

Residual Values
  • There is now no variance of the % Residual based on kms travelled – these rates are now fixed in accordance with the term of lease selected
  • 1 Yr Lease 65.63% Residual
  • 2 Yr Lease 56.25% Residual
  • 3 Yr Lease 46.88% Residual
  • 4 Yr Lease 37.50% Residual
  • 5 Yr Lease 28.13% Residual
  • The ATO has a car depreciation limit – As of 2021-22 = $60,733

Luxury Car Tax Rate and Thresholds
Cars with a Luxury Car Tax (LCT) value over the LCT Threshold attract an LCT rate of 33%.
LTC Thresholds are GST-inclusive.
For the 2021-2022 Financial year the threshold for Luxury car tax is as follows;
For fuel effecient vehicles – $79,659
For all other vehicles – $69, 152

Traditional Novated Lease

What is an Associate Lease?

An Assiciate Lease is an agreement between 4 parties to own and use a Car – the parties being:

  • Employee – You
  • Employer – the organisation you work for
  • Associate – provides the car for the Employees use
  • Administrator – interface with each the Employee, Employer and the Associate

The Administrator facilitates:

  • All of your Tax Saving/Benefits
  • Car quotes for affordability including running cost
  • All documentation required
  • The flow of all monies
  • All online reporting for Employee
  • All online reporting for Employer

What are the benefits of an Associate Lease?
  • Turnkey and simple
  • You choose the car
  • Majority of expenses are paid with Pre-Tax monies (min 44.5% discount)
  • No upfront cost
  • All GST on expenses is refunded
  • You have unrestricted use and who can drive it
  • Even with low km’s, you will achieve considerable tax savings
  • Budgeted expenses:
    • are all-inclusive with Fixed Repayment
    • large expenses such as Rego or tyres – the money is there when it is due

Overview – how does your Associate Lease actually work?
  1. Complete the quote online which sets out/up all variables such as the car cost and running expenses for your Associate Lease
  2. Proceed to implement/checkout when happy with Tax Benefit quote
  3. Establish your FAA Salary Packaging account
  4. Download the FAA App
  5. Now choose your car, or you can decide to Lease your existing car
  6. All required documentation will be eSign and automatically generated for:
    • The Associate purchases the car – or you can package your Existing car(Note if a Financer requires an ink signature, print, sign and scan of this will be the only non-digital step)
    • The Associate Lease electronic document
    • Employer requirement to make deductions from your pay into your FAA Salary Packaging Trust Acc
    • Employee Participation Agreement
    • Any policy documents specified by your employer
    • Fuel cards ordered
  7. Pay deductions will commence
  8. Organise collecting your new car (If not packaging your existing car)
  9. As expenses arise:
    • Pay or claim reimbursement for these expenses from your FAA Salary Packaging Trust Acc
  10. Log onto your FAA portal/App to view all transactions or reporting you would like to see
  11. Increase or reduce your payroll deductions to in alignment with your actual cost via your App
  12. All necessary reporting will be provided to your Employer

Who can be the Associate?
  • Anyone who can hold an ABN that you trust
  • The Associate might be your husband or wife, partner, child, parent or someone closely connected with you
  • This person enters into an agreement with your Employer where they agree to lease your car

Who owns the car with an Associate Lease?
  • The Associate, but terms of ownership at the end of lease can be agreed upon with the Associate
  • For the term of the Associate Lease you essentially lease/hire the car from your Associate

Operating costs that can be packaged include:
  • Lease Repayments
  • Fuel, Oil and Radiator Coolant
  • Service and Maintenance
  • Replacements (eg: Tyres, Windows etc)
  • Damages or Repairs (Conditions Apply)
  • Registration (including transfer costs if any apply)
  • Comprehensive Insurance and excess payments
  • Other types of Insurance (eg: Tyre & Rim, Gap and more)
  • Roadside Assistance
  • Paint Protection
  • Rust Proofing (not removable)
  • Window Tinting
  • Car Washing and Detailing
  • Car Air Fresheners and Deodorisers
  • Protection for Fabric Interior (not removable)
  • Extended Warranty for Novated Lease Car
  • Excess on Insurance

Items that can NOT be packaged?
  • Parking fees
  • Tolls
  • Fines
  • Licences
  • After market goodies (not on the car at time of purchase) that are not replacing similar
    • Bull Bars
    • Tow Bars
    • Sound Systems
    • Mag Wheels (Unless replacement)
    • Tinting
    • Roof/Bike racks

Budget Variations
  • Your quoted running expenses are an estimate only
  • Your FAA App helps you track your costs and increase/decrease the amount of your Pre-Tax dollars you are diverting to meet your actual costs
  • Using the fuel card and in-App receipt capture automates the claiming process

Myth Busted: There is no minimum kms needed for Novated Leases and we can package cars of any age

Fuel Cards
  • Being able to use a Fuel Card is another great benefit of a Novated Lease.
  • To fill up with a Fuel Card, simply present your card at participating service stations to quickly and easily purchase fuel.
  • These cards are widely accepted and are an easy and quick way to purchase fuel.
  • Depending on your Employer, you may also be able to pay for your maintenance and services at participating organisations, and even tyres.
  • FAA provides a Fuel Card(s) which is used as a debit card at all fuel stations, where a Fuel Card is accepted.

End of finance lease options
  1. Lease ends and lease another new car
    • Lease ceases – FAA look after this process
    • Trade or sell your car privately however you chose to
    • From proceeds of sale, payout residual/balloon
    • Any surplus funds from the sale are yours to direct into your personal bank account
    • All funds in your account remain there for the new lease
  2. Stop leasing this car and sell the car
    • Lease ceases – FAA look after this process
    • Sell your car privately however you chose to
    • From proceeds of sale, payout residual/balloon
    • Any surplus funds from the sale are yours to direct into your personal bank account
    • The funds in your Salary Packaging account will be reversed back through your employers payroll or can be used for any other benefit you are packaging such as into your Superannuation provided you are not going to exceed your Cap
  3. Release the car – seamless transition
    • Refinance the residual/balloon
    • A new lease is put in place
    • As the new refinance amount is lower, your new lease deductions will be much lower
    • All funds in your account remain there for the lease to continue
  4. Stop leasing and keep the car
    • Cease leasing
    • Payout the residual/balloon of the loan with personal funds
    • The funds in your Salary Packaging account will be reversed back through your employers payroll or can be used for any other benefit you are packaging such as into your Superannuation provided you are not going to exceed your Cap.
    • Registration is in your name so nothing else changes

Residual Values
  • There is now no variance of the % Residual based on kms travelled – these rates are now fixed in accordance with the term of lease selected.
  • 1 Yr Lease 65.63% Residual
  • 2 Yr Lease 56.25% Residual
  • 3 Yr Lease 46.88% Residual
  • 4 Yr Lease 37.50% Residual
  • 5 Yr Lease 28.13% Residual

Luxury Car Tax rate and Thresholds
Cars with a Luxury Car Tax (LCT) value over the LCT Threshold attract an LCT rate of 33%.
LTC Thresholds are GST-inclusive.
For the 2021-2022 Financial year the threshold for Luxury car tax is as follows;
For fuel effecient vehicles – $79,659
For all other vehicles – $69, 152

Fully Maintained Associate Lease (FMAL)

What is an Fully Maintained Associate Lease (FMAL)?

An Associate Lease is an agreement between 4 parties to own and use a Car – the parties being:

  • Employee – You
  • Employer – the organisation you work for
  • Associate – provides the car for the Employees use
  • Administrator – interface with each the Employee, Employer and the Associate

The Administrator facilitates:

  • All of your Tax Saving/Benefits
  • Car quotes for affordability including running cost
  • All documentation required
  • The flow of all monies
  • All online reporting for Employee
  • All online reporting for Employer
  • All online reporting for Associate

What are the benefits of an FMAL?

FMAL Leasing typically out performs all other leasing models for monies saved and flexibility.

FMAL leasing is ideal if you are looking to purchase a new or used car, or are happy with your current car, and would like to take advantage of the tax savings involved with salary packaging a Car Lease.

  • Unlike other leasing models Post-Tax component can be reduced or eliminated
  • Turnkey and simple
  • You can choose any car
  • Majority of expenses are paid with Pre-Tax monies (Typically 44.5% discount)
  • No upfront cost
  • All GST on expenses is refunded
  • You have unrestricted use and who can drive it
  • Even with low km’s, you will achieve considerable tax savings
  • Budgeted expenses:
    • are all-inclusive with Fixed Repayment
    • large expenses such as Rego or tyres – the money is there when it is due

Overview – how does your FMAL actually work?
  1. Complete the quote online which sets out/up all variables such as the car cost and running expenses for your FMAL Lease
  2. Proceed to implement/checkout when happy with Tax Benefit quote
  3. Setup FAA as your Sal Pac Admin for Employer
  4. Establish your FAA Salary Packaging account
  5. Download the FAA App
  6. Find an Associate (Spouse, Partner, Family member etc.)
  7. Associate obtains an ABN with help of the FAA portal or App
  8. Now choose your car, or you can decide to Lease your existing car
  9. The Associate purchases the car – or you can package your Existing car
  10. All required documentation will be eSign and automatically generated for:
    • The FMAL Lease electronic document
    • Employer requirement to make deductions from your pay into your FAA Salary Packaging Trust Acc
    • Employee Participation Agreement
    • Any policy documents specified by your employer
    • Fuel cards ordered (Note if a Financer for the Associate requires an ink signature, print, sign and scan of this will be the only non-digital step)
  11. Pay deductions will commence from your Pre-Tax salary and forwarded on to your Associate
  12. Organise collecting your new car (If not packaging your existing car)
  13. As expenses arise:
    • Your Associate will pay or claim reimbursement for these expenses from their Associate FAA Salary Packaging Trust Acc
  14. Log onto your FAA portal/App to view all transactions or reporting you would like to see
  15. Increase or reduce your payroll deductions to in alignment with your actual cost via your App
  16. All necessary reporting will be provided to your Employer

Who can be the Associate?
  • The Associate might be your husband or wife, partner, child, parent or another family member that you trust
  • Your Associate must be able to hold an ABN
  • This person enters into an agreement with your Employer where they agree to lease your car

Who owns the car with a FMAL?
  • The Associate, but terms of ownership at the end of lease can be agreed upon with the Associate
  • For the term of the FMAL you essentially lease/hire the car from your Associate

Operating costs that can be packaged include:
  • Fuel, Oil and Radiator Coolant
  • Service and Maintenance
  • Replacements (eg: Tyres, Windows etc)
  • Damages or Repairs (Conditions Apply – like for like etc)
  • Registration (including transfer costs if any apply)
  • Comprehensive Insurance and excess payments
  • Other types of Insurance (eg: Tyre & Rim, Gap and more)
  • Roadside Assistance
  • Paint Protection
  • Rust Proofing (not removable)
  • Window Tinting
  • Car Washing and Detailing
  • Car Air Fresheners and Deodorisers
  • Protection for Fabric Interior (not removable)
  • Extended Warranty for Novated Lease Car
  • Excess on Insurance

Items that can NOT be packaged?
  • Parking fees
  • Tolls
  • Fines
  • Licences
  • After market goodies (not on the car at time of purchase) that are not replacing similar
    • Bull Bars
    • Tow Bars
    • Sound Systems
    • Mag Wheels (Unless replacement)
    • Tinting
    • Roof/Bike racks

Budget Variations
  • Your quoted running expenses are an estimate only
  • Your FAA App helps you track your costs and increase/decrease the amount of your Pre-Tax dollars you are diverting to meet your actual costs
  • Using the fuel card and in-App receipt capture automates the claiming process

Myth Busted: There is no minimum kms needed for Novated Leases and we can package cars of any age

Fuel Cards
  • Being able to use a Fuel Card is another great benefit of a Novated Lease.
  • To fill up with a Fuel Card, simply present your card at participating service stations to quickly and easily purchase fuel.
  • These cards are widely accepted and are an easy and quick way to purchase fuel.
  • Depending on your Employer, you may also be able to pay for your maintenance and services at participating organisations, and even tyres.
  • FAA provides a Fuel Card(s) which is used as a debit card at all fuel stations, where a Fuel Card is accepted.

End of finance lease options
  1. Lease ends and lease another new car
    • Lease ceases – FAA look after this process
    • Trade or sell your car privately however you chose to
    • Any surplus funds from the sale are yours to direct into your personal bank account
    • All funds in your account remain there for the new lease
  2. Stop leasing this car and sell the car
    • Lease ceases – FAA look after this process
    • Associate sells the car privately however they chose to
    • Any surplus funds from the sale are the Associates to direct into their personal bank account
    • The funds in the Associate’s Salary Packaging account are theirs to keep
  3. Release the car – seamless transition
    • A new lease is put in place
    • As the new refinance amount is lower, your new lease deductions will be much lower
    • The funds in the Associate’s Salary Packaging account are theirs to keep
  4. Stop leasing and keep the car
    • Cease leasing,
    • The funds in the Associate’s Salary Packaging account are theirs to keep
    • Registration is in your Associate’s name, so nothing else changes

Residual Values
  • There is now no variance of the % Residual based on kms travelled – these rates are now fixed in accordance with the term of lease selected.
  • 1 Yr Lease 65.63% Residual
  • 2 Yr Lease 56.25% Residual
  • 3 Yr Lease 46.88% Residual
  • 4 Yr Lease 37.50% Residual
  • 5 Yr Lease 28.13% Residual

Luxury Car Tax rate and Thresholds
Cars with a Luxury Car Tax (LCT) value over the LCT Threshold attract an LCT rate of 33%.
LTC Thresholds are GST-inclusive.
For the 2021-2022 Financial year the threshold for Luxury car tax is as follows;
For fuel effecient vehicles – $79,659
For all other vehicles – $69, 152