ADF salary sacrifice super novated lease is an arrangement that enables members to purchase new and pre-owned cars with all payments and running costs included in one monthly payment plan. However, this may incur fringe benefits tax (FBT) and could impact government benefits negatively; in avoiding any potential surprises, it is advised that before taking this route, independent financial advice should be sought before going down this path.
Tax benefits
The Australian Defence Force Novated Lease offers employees an all-inclusive salary packaging option to finance both the purchase and running costs of their vehicle with pre-tax dollars, significantly reducing the overall tax burden and saving, especially in taxes and Fringe Benefits Tax (FBT), payable on benefits such as cars. The setup is simple; weekly payments cover everything needed to run your vehicle smoothly.
Tax savings will depend on individual circumstances; however, in general, ADF salary sacrifice super novated leases can save an average of up to $3,000 on vehicle costs through discounts in the sale price and fuel costs and not having to pay GST when leasing cars. Furthermore, driving less annually reduces FBT liabilities significantly.
Before making your choice, it is vital to do your research and secure the best deal. Reputable novated leasing companies provide honest and transparent fee details as well as a quote detailing all running costs such as finance, fuel, servicing, and tyre maintenance costs as well as Vero by Suncorp comprehensive motor insurance premiums and residual value established by ATO at the end of the lease term – including an agreed upon residual value at which point it becomes your responsibility.
Flexibility
Australian Defence Force employees can choose from flexible work arrangements that allow optimal work-life balance, such as part-time work, condensed hours or working from home. A novated lease offers additional savings – its payments come directly from pre-tax income, leaving more cash available for other expenses.
When searching for a novated leasing provider, always check their reputation and read reviews to ensure they’re reliable. A local company may also help negotiate better car dealership prices and offer competitive interest rates and up-front discounts; plus, they’ll take care of all paperwork for you – and of course, a reputable novated leasing provider must have an exceptional customer service team!
Customisation
As an ADF member, finding the ideal vehicle is critical to meeting your requirements. Various leasing arrangements are available to military members; among these is novated leasing. With this agreement, you can buy a new or pre-owned vehicle at reduced costs with one payment plan combining all associated expenses into one monthly bill, saving time and money for car expenses while helping reduce taxable income.
Novated leasing can be an attractive option for ADF members, but finding a trustworthy and dependable provider that can offer competitive deals can be challenging. One way is to work with an organisation with established relationships with car dealerships; they may have leverage to negotiate special discounts for clients through these relationships. Another strategy to ensure you find the best possible deal is researching various options and comparing prices; this way, you won’t overspend or pay for features you don’t require or overspent on a car purchase.
Novated leases are ATO-approved arrangements that enable you to finance the costs associated with owning and running your choice of car through salary deductions, thus saving on income tax and GST and eliminating the hassle of finding financing through banks or dealers. By choosing this route, you can pay for a new or pre-owned car with a pre-tax salary and include ongoing expenses such as fuel, registration and servicing in your monthly repayments.
Security
Secure housing, reliable vehicles and savings are critical components to helping Defence Force families face the challenges associated with deployment. The ADF Financial Services Consumer Council offers resources that can assist Defence families in managing their finances better, such as budgeting for deployment and setting debt-free goals. In addition, loans, grants and welfare services may be provided as aid.
The ADF provides comprehensive free healthcare to its members on and off base, including medical treatment, ambulance transport, dental care and allied health services. Furthermore, Defence offers several programs to assist family members of deployed members during deployment, such as Defence Member and Family Support, which helps when postings include special needs children in the family unit.
