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How Much Can I Save With a Novated Lease?
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How much can you save with a novated lease? Thousands... This easy to understand breakdown shows you exactly how much, and how it all works.

How much can you save with a novated lease? Thousands... This easy to understand breakdown shows you exactly how much, and how it all works.

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How Much Can I Save With a Novated Lease? Presentation Transcript

  • 1. autopia.com.au Intelligent Car Ownership How much can I save  with a novated lease?August 2011
  • 2. What is a novated lease? Intelligent Car Ownership Probably a lot more than you think..Page 2 August 2011
  • 3. What is a novated lease? Intelligent Car Ownership Probably a lot more than you think.. There are a number of ways to pay for a car:  Page 3 August 2011
  • 4. What is a novated lease? Intelligent Car Ownership Probably a lot more than you think.. There are a number of ways to pay for a car:   Cash Personal finance Home loan redraw Commercial Hire PurchasePage 4 August 2011
  • 5. What is a novated lease? Intelligent Car Ownership Probably a lot more than you think.. There are a number of ways to pay for a car:   Cash Personal finance Home loan redraw Commercial Hire Purchase Let’s compare a novated lease, Page 5 August 2011
  • 6. What is a novated lease? Intelligent Car Ownership Probably a lot more than you think.. There are a number of ways to pay for a car:   Cash Personal finance Home loan redraw Commercial Hire Purchase Let’s compare a novated lease, withPage 6 August 2011
  • 7. What is a novated lease? Intelligent Car Ownership Starting with the following salary and vehicle details $60,000 + super Page 7 August 2011
  • 8. What is a novated lease? Intelligent Car Ownership Starting with the following salary and vehicle details $60,000 + super  Volkswagen Golf Trendline  $30,808 on road cost   15,000 kilometres p/a  No business use for the car  Own car for three yearsPage 8 August 2011
  • 9. What is a novated lease? Intelligent Car Ownership Starting with the following salary and vehicle details $60,000 + super  Volkswagen Golf Trendline  $30,808 on road cost   15,000 kilometres p/a  No business use for the car  Own car for three years Note you don’t have  to have any business  use for your carPage 9 August 2011
  • 10. What is a novated lease? Intelligent Car Ownership First we’ll see how much this car really costsPage 10 August 2011
  • 11. What is a novated lease? Intelligent Car Ownership First we’ll see how much this car really costs Volkswagen Golf Trendline, driving 15,000 kilometres a year  The annual running costs would be:Page 11 August 2011
  • 12. What is a novated lease? Intelligent Car Ownership First we’ll see how much this car really costs Volkswagen Golf Trendline, driving 15,000 kilometres a year  The annual running costs would be:            Finance $8,319Page 12 August 2011
  • 13. What is a novated lease? Intelligent Car Ownership First we’ll see how much this car really costs Volkswagen Golf Trendline, driving 15,000 kilometres a year  The annual running costs would be:            Finance $8,319 Fuel  $1,937Page 13 August 2011
  • 14. What is a novated lease? Intelligent Car Ownership First we’ll see how much this car really costs Volkswagen Golf Trendline, driving 15,000 kilometres a year  The annual running costs would be:            Finance $8,319 Fuel  $1,937 Servicing $660                             Page 14 August 2011
  • 15. What is a novated lease? Intelligent Car Ownership First we’ll see how much this car really costs Volkswagen Golf Trendline, driving 15,000 kilometres a year  The annual running costs would be:            Finance $8,319 Fuel  $1,937 Servicing $660                              Registration & CTP $837        Page 15 August 2011
  • 16. What is a novated lease? Intelligent Car Ownership First we’ll see how much this car really costs Volkswagen Golf Trendline, driving 15,000 kilometres a year  The annual running costs would be:            Finance $8,319 Fuel  $1,937 Servicing $660                              Registration & CTP $837         Insurance $1,432Page 16 August 2011
  • 17. What is a novated lease? Intelligent Car Ownership First we’ll see how much this car really costs Volkswagen Golf Trendline, driving 15,000 kilometres a year  The annual running costs would be:            Finance $8,319 Fuel  $1,937 Servicing $660                              Registration & CTP $837         Insurance $1,432 Total $13,508Page 17 August 2011
  • 18. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated leasePage 18 August 2011
  • 19. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease With a novated leasing specialist, your running costs would actually be lowerPage 19 August 2011
  • 20. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease With a novated leasing specialist, your running costs would actually be lower This is due to the buying power of the organisationPage 20 August 2011
  • 21. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease With a novated leasing specialist, your running costs would actually be lower This is due to the buying power of the organisation For the sake of comparison however  We’ll assume the $13,508 stays the samePage 21 August 2011
  • 22. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease With a novated leasing specialist, your running costs would actually be lower This is due to the buying power of the organisation For the sake of comparison however  We’ll assume the $13,508 stays the same So let’s take a look at the figures..Page 22 August 2011
  • 23. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease Payroll treatment Personal finance Gross salary $65,400 $65,400Page 23 August 2011
  • 24. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease Payroll treatment Personal finance Gross salary $65,400 $65,400 Your gross income stays  the same no matter how  you pay for the carPage 24 August 2011
  • 25. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease Payroll treatment Personal finance Gross salary $65,400 $65,400 Salary sacrifice $0 ‐$6,996Page 25 August 2011
  • 26. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease Payroll treatment Personal finance Gross salary $65,400 $65,400 Salary sacrifice $0 ‐$6,996 With the novated lease,  you’ll sacrifice part of  your salary to cover the  expenses of the carPage 26 August 2011
  • 27. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease Payroll treatment Personal finance Gross salary $65,400 $65,400 Salary sacrifice $0 ‐$6,996 Superannuation ‐$5,400 ‐$5,400Page 27 August 2011
  • 28. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease Payroll treatment Personal finance Gross salary $65,400 $65,400 Salary sacrifice $0 ‐$6,996 Superannuation ‐$5,400 ‐$5,400 Now payroll will deduct  your superannuation paymentsPage 28 August 2011
  • 29. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease Payroll treatment Personal finance Gross salary $65,400 $65,400 Salary sacrifice $0 ‐$6,996 Superannuation ‐$5,400 ‐$5,400 Now payroll will deduct  your superannuation payments These are based on your  gross salary, so they stay the samePage 29 August 2011
  • 30. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease Payroll treatment Personal finance Gross salary $65,400 $65,400 Salary sacrifice $0 ‐$6,996 Superannuation ‐$5,400 ‐$5,400 Taxable income $60,000 $53,004Page 30 August 2011
  • 31. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease Payroll treatment Personal finance Gross salary $65,400 $65,400 Salary sacrifice $0 ‐$6,996 Superannuation ‐$5,400 ‐$5,400 Taxable income $60,000 $53,004 Over here your taxable  income has been reducedPage 31 August 2011
  • 32. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease Payroll treatment Personal finance Gross salary $65,400 $65,400 Salary sacrifice $0 ‐$6,996 Superannuation ‐$5,400 ‐$5,400 Taxable income $60,000 $53,004 By the amount that  you have sacrificed Over here your taxable  income has been reducedPage 32 August 2011
  • 33. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease Payroll treatment Personal finance Gross salary $65,400 $65,400 Salary sacrifice $0 ‐$6,996 Superannuation ‐$5,400 ‐$5,400 Taxable income $60,000 $53,004 By the amount that  you have sacrificed But over here it  stays the same Over here your taxable  income has been reducedPage 33 August 2011
  • 34. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease Payroll treatment Personal finance Gross salary $65,400 $65,400 Salary sacrifice $0 ‐$6,996 Superannuation ‐$5,400 ‐$5,400 Taxable income $60,000 $53,004 Income tax ‐$12,450 ‐$10,246 So this is what  it means to your  income taxPage 34 August 2011
  • 35. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease Payroll treatment Personal finance Gross salary $65,400 $65,400 Salary sacrifice $0 ‐$6,996 Superannuation ‐$5,400 ‐$5,400 Taxable income $60,000 $53,004 Income tax ‐$12,450 ‐$10,246 Employee contribution $0 ‐$5,813Page 35 August 2011
  • 36. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease Payroll treatment Personal finance Gross salary $65,400 $65,400 Salary sacrifice $0 ‐$6,996 Superannuation ‐$5,400 ‐$5,400 Taxable income $60,000 $53,004 Income tax ‐$12,450 ‐$10,246 Employee contribution $0 ‐$5,813 This is the ATO trying to make  up for some of that lost income taxPage 36 August 2011
  • 37. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease Payroll treatment Personal finance Gross salary $65,400 $65,400 Salary sacrifice $0 ‐$6,996 Superannuation ‐$5,400 ‐$5,400 Taxable income $60,000 $53,004 Income tax ‐$12,450 ‐$10,246 Employee contribution $0 ‐$5,813 This is the ATO trying to make  up for some of that lost income tax It’s also how we prevent  you having to pay Fringe Benefits TaxPage 37 August 2011
  • 38. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease Payroll treatment Personal finance Gross salary $65,400 $65,400 Salary sacrifice $0 ‐$6,996 Superannuation ‐$5,400 ‐$5,400 Taxable income $60,000 $53,004 Income tax ‐$12,450 ‐$10,246 Employee contribution $0 ‐$5,813 Take home pay $47,550 $36,945Page 38 August 2011
  • 39. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease Payroll treatment Personal finance Gross salary $65,400 $65,400 Salary sacrifice $0 ‐$6,996 Superannuation ‐$5,400 ‐$5,400 Taxable income $60,000 $53,004 Income tax ‐$12,450 ‐$10,246 Employee contribution $0 ‐$5,813 Take home pay $47,550 $36,945 And this is how  it all washes upPage 39 August 2011
  • 40. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease Payroll treatment Personal finance Gross salary $65,400 $65,400 Salary sacrifice $0 ‐$6,996 Superannuation ‐$5,400 ‐$5,400 Taxable income $60,000 $53,004 Income tax ‐$12,450 ‐$10,246 Employee contribution $0 ‐$5,813 Take home pay $47,550 $36,945 But that’s  And this is how  not the whole story.. it all washes upPage 40 August 2011
  • 41. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease Payroll treatment Personal finance Gross salary $65,400 $65,400 Salary sacrifice $0 ‐$6,996 Superannuation ‐$5,400 ‐$5,400 Taxable income $60,000 $53,004 Income tax ‐$12,450 ‐$10,246 Employee contribution $0 ‐$5,813 Take home pay $47,550 $36,945 Running costs ‐$13,508 $0Page 41 August 2011
  • 42. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease Payroll treatment Personal finance Gross salary $65,400 $65,400 Salary sacrifice $0 ‐$6,996 Superannuation ‐$5,400 ‐$5,400 Taxable income $60,000 $53,004 Income tax ‐$12,450 ‐$10,246 Over here you’ve  Employee contribution $0 ‐$5,813 already paid for  your car Take home pay $47,550 $36,945 Running costs ‐$13,508 $0Page 42 August 2011
  • 43. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease Payroll treatment Personal finance Gross salary $65,400 $65,400 Salary sacrifice $0 ‐$6,996 Superannuation ‐$5,400 ‐$5,400 Taxable income $60,000 $53,004 Income tax ‐$12,450 ‐$10,246 Over here you’ve  Employee contribution $0 ‐$5,813 already paid for  your car Take home pay $47,550 $36,945 Running costs ‐$13,508 $0 And over here you haven’tPage 43 August 2011
  • 44. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease Payroll treatment Personal finance Gross salary $65,400 $65,400 Salary sacrifice $0 ‐$6,996 Superannuation ‐$5,400 ‐$5,400 Taxable income $60,000 $53,004 Income tax ‐$12,450 ‐$10,246 Employee contribution $0 ‐$5,813 Take home pay $47,550 $36,945 Running costs ‐$13,508 $0 Disposable income $34,042 $36,945Page 44 August 2011
  • 45. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease Payroll treatment Personal finance Gross salary $65,400 $65,400 Salary sacrifice $0 ‐$6,996 Superannuation ‐$5,400 ‐$5,400 Taxable income $60,000 $53,004 Income tax ‐$12,450 ‐$10,246 Employee contribution $0 And the  ‐$5,813 difference...................................  Take home pay $47,550 $36,945 Running costs ‐$13,508 $0 Disposable income $34,042 $36,945Page 45 August 2011
  • 46. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease Payroll treatment Personal finance Gross salary $65,400 $65,400 Salary sacrifice $0 ‐$6,996 Superannuation ‐$5,400 ‐$5,400 Taxable income $60,000 $53,004 Income tax ‐$12,450 ‐$10,246 Employee contribution $0 And the  ‐$5,813 difference................................... …is $2,903 Take home pay $47,550 $36,945 Running costs ‐$13,508 $0 Disposable income $34,042 $36,945Page 46 August 2011
  • 47. What is a novated lease? Intelligent Car Ownership Now we’ll compare personal finance with a novated lease Payroll treatment Personal finance Gross salary $65,400 $65,400 Salary sacrifice $0 ‐$6,996 Superannuation ‐$5,400 ‐$5,400 Taxable income $60,000 $53,004 Income tax ‐$12,450 ‐$10,246 Employee contribution $0 And the  ‐$5,813 difference................................... …is $2,903 Take home pay $47,550 $36,945 in your pocket,  Running costs ‐$13,508 $0 or the ATO’s.. Disposable income $34,042 $36,945Page 47 August 2011
  • 48. What is a novated lease? Intelligent Car Ownership So how much can you save with a novated lease?Page 48 August 2011
  • 49. What is a novated lease? Intelligent Car Ownership So how much can you save with a novated lease? In this instance, over the life of the leasePage 49 August 2011
  • 50. What is a novated lease? Intelligent Car Ownership So how much can you save with a novated lease? In this instance, over the life of the lease That’s a massive saving of $8,710Page 50 August 2011
  • 51. What is a novated lease? Intelligent Car Ownership So how much can you save with a novated lease? In this instance, over the life of the lease $8,710 That’s a massive saving of                          … tax freePage 51 August 2011
  • 52. What is a novated lease? Intelligent Car Ownership So how much can you save with a novated lease? In this instance, over the life of the lease $8,710 That’s a massive saving of                          … tax free What would you do with the cash? Take the family on a holiday? Pay down the mortgage? Buy a jetski?Page 52 August 2011
  • 53. What is a novated lease? Intelligent Car Ownership A novated lease is Quite simply the cheapest way to own a car “Thanks to Autopia I’ve paid for a new fireplace, a new kitchen,  I’ve packaged two cars, and I couldn’t be happier.” Brad Freer, Newcastle, NSW Click here for more  For more information, and intelligent advice: case studies Visit www.autopia.com.au Call 1800 288 674Page 53 August 2011