One of the most common questions that we get asked by clients is, ‘can I have two car leases running concurrently?’ The answer is simple, yes. You can also novate a car for your wife/husband/spouse or children. Now, every employer is different and some have rules about whether you can have two or more leases or the cylinder requirements of the vehicle, however, the majority of employers allow multiple leases.
The process is the same regardless of the number of vehicles you lease. You find the right make, model and colour and then work out the car’s usage and term of the lease but this is what your Novated Account Manager is here to help you with. From finding the best deal on the car, looking through our panel of lenders, working out how much fuel the shiny new V8 Mustang could use.
So, why have two novated leases?
- You have a teenage child, about to spend $5000 on a private sale Corolla which has done 220,000kms. Think again, that so-called bargain that was driven by Thelma from church and back probably isn’t that much of a bargain. Regardless of how you purchase this vehicle, you will still have to pay rego, fuel, servicing, tyres, and insurance. Why not get your daughter or son a safe new car with airbags that will actually deploy in case of an accident? For an extra thirty odd dollars per week, he or she can drive a safe reliable car with warranty included. Most people are on-selling cheap cars for a reason, what seems like a bargain could actually be a car which needs a timing belt replacement or has a dodgy transmission that needs replacing. That $5000 car just became a $8000 car very quickly.
- You need a new family car. You already understand the benefits of a novation, why not add the family car to this? Even if your spouse is driving the car, this additional lease is still perfectly legal and once again it helps reduce the running cost of the vehicle that you have to pay for anyway. This means, not only are you paying for the car and it’s running cost but you are once again saving cash flow within the family budget.
- Retirement, yep that’s right, are you getting ready to retire shortly? Why not set up that car now and pay for it out of your taxable salary rather than dipping into your superannuation? If you are looking for a tow vehicle or looking to do the Big Lap around Australia, take advantage of your fleet discount. Set the car up right with all the correct gear from ARB/TJM or ECB and get a professionals help with procurement so that you are not making expensive decisions twice. This can also help reduce your taxable income in your transition to retirement phase.
So, let’s look at the benefits of novating;
- Further reduction in taxable income,
- GST savings on purchase price of new and used vehicles,
- GST and Tax savings on running costs of the car,
- Everything, including running costs, is budgeted and taken care of,
- Cheaper purchase price on a new car due to fleet discount,
- And finally, a happy family driving their new car.
And of course, the cons;
The awkward speeding fine conversation. If a family member gets a speeding fine, since the vehicle is registered under the employee’s name, the speeding fine will be addressed to them as the registered operator of the vehicle. But if you obey the road rules like everybody does, this shouldn’t be a problem.
So, if your daughter is about to go off to uni, your husband needs that new ute for work or the family runabout is on its last legs, it could be time to look at taking advantage of the extra tax saving and hop into driver’s seat of your new car. To find out more, simply get in contact with one our fleet experts. They will run the numbers and get a second opinion for you. Just 10 mins on the phone could save you from either heartache or a few thousand in tax each year. Click the button below to get your instant quote now.