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Lost the company car and need a novated lease for work?

By March 22, 2018No Comments

SPA gets close to one hundred enquiries every month from staff members and employees who are leaving the company car behind and taking allowances instead.

The big change that has pushed the death of the company car over the edge has been the change in tax legislation that requires operating leases to be placed on balance sheets. This has forced most CFO’s, and HR managers to rethink the way that they use the company car and to what level.

Many organisations have moved towards a car allowance program allowing the employee to take advantage of an extra payment back to the salary instead of using the work supplied vehicle. This all of a sudden has thrown some questions into the market, so, we are here to debunk them.

 

Your company has just announced you’re losing your company car.

Firstly, don’t panic, most employers will give an employee suitable notice to change over. Don’t rush out the first weekend and buy the first car that you drive. Make an assessment of what you require in the car, what it’s primary function will be, will it be suitable for the role and will it do the job safely. Remember, there is no point buying a Mazda MX5 convertible if you need to take sample products with you that won’t fit in the boot.

Vehicle Expenses: How much are the running costs?

Gauge what it costs to run your current car. How much will it cost to register and insure? How many services will it need? How much driving do you currently do? These are all great questions to ask yourself when considering a new vehicle that will be used for work. Some preparation will allow you to assess if the allowance you have been offered is fair and reasonable or if your boss really is related to Scrooge McDuck as you have always suspected.

Evaluate the current car you’re using.

So, what are you driving at the moment, a Camry or Hyundai i30? More than likely your employer is looking for and has budgeted on a like-for-like scenario. They won’t be budgeting on you driving around in a brand new Landcruiser Sahara when you just hopped out of a Honda Jazz.

If you are unsure, get your employer to speak to an expert.

A few people are generally involved in making this decision. Normally, HR and your finance manager. Get them to give us a call to ensure they have run through the whole of life situations and understand what this means to you.

 

SPA can easily put together quotations to show the difference between your current salary and what the current out of pocket expenses are, if any. Many employees choose to update their current car and the generous tax discounts that come into play and then transfer the vehicle over to become the family vehicle at a heavily reduced purchase price that has been paid for by your employer before the government would have normally taken their slice.

 

Talk to the team at SPA by calling 1300 786 664 and we can help you through the novated lease process and find the correct vehicle that fits both your business and personal needs. Click one of the buttons below to get an instant online quote or see our current vehicle deals.

 

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