Why a Novated Lease can benefit you?

Each party must be aware of their own responsibilities and obligations especially for the employers as they are the one who is required or oblige to secure the monthly lease payments to the lease company. The payment will be deducted to their employee’s pre-tax income.

As the employee or the person who will enter into lease, they have the right to choose the vehicle that they want; this is the car that is best for their lifestyle. The color, model, and the features, these are some of the components that an employee considering in choosing the best car that they are going to lease. They have the control in the maintenance and in caring the vehicle, to keep its good appearance they need to do the maintenance. If the employees change their job, the responsibilities of the agreement can be transferred to their new employer or the other option is they will pay it on their own. In regards to tax, it is a good help in reducing the tax that they are paying as it was paid out of their pre- tax salary. The employee has the right to keep the equity that was built in the car.

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As the employer, they have nothing to worry about the residual risk value, when their employee leaves the company for any reasons they can save because they don’t have any excess company cars. The employers can use this if they are attracting employee to work for them as it is effective in the form of increase salary remuneration  without any additional or just a minimal expenses for the company. It can also save the time of the employer in the care and maintenance of the car unlike in the company cars. They don’t need to include it to their asset of liabilities and they don’t need to do anything about the novated lease as everything will be processed by the lease company.

As a lease company, they benefit from the fees that the employer going to pay and to the commissions when the deal is closed.

Each party in this novated lease can get the things that they want to get and at the same time they are benefiting from it. It can save the time, money, and the effort of each other when they enter into a Novated arrangement.

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