Car Loans
Novated Lease
Integrates effortlessly. An alternative way to get and run a car.
Value-packed. Value-add.
We’re helping more Australians drive their salary further. With a novated lease, employees can use pre-tax and if required, post-tax salary to pay for a car and its expenses, in one easy monthly payment.
If your employer offers a novated lease, it could be a smart move. It’s an agreement between us (the finance provider), you (the employee) and your employer. A salary packaging partner, usually chosen by your employer, arranges and manages your lease.
Why get a novated lease?
Here’s what you could enjoy:
Salary boost
Use your pre-tax and if required, post-tax salary to lease a car and unlock potential tax savings
Bundle costs
Bundle your car’s purchase price with running costs such as fuel or charging, servicing, registration and insurance into one lease
Fixed payments
Fixed monthly payments for the entire lease term
FBT exemption
Save more when you take advantage of the Australian Government’s fringe benefits tax (FBT) exemption for eligible electric vehicles (EV)
No fuss
A simpler, fuss-free way to buy and run a car
Novated + Electric Vehicles = EV-peasy savings
When you use a novated lease to get behind the wheel of a petrol car, only part of the payment comes out of your salary before tax. But choose an eligible EV and thanks to the Australian Government’s FBT exemption for eligible EVs, your entire lease payment (referred to as ‘rent instalment’ in your contract) can be salary-packaged before tax. That could mean some juicy tax savings with every pay.
How to apply?
We’ve partnered with some of Australia’s largest salary packaging providers to offer our novated lease product. You’ll need to apply for a novated lease with a salary packaging provider via your employer, so speak to your employer about whether they offer salary packaging and if so, whether novated leasing is an available option.
Speak
Speak to your employer about a novated lease option
Choose
Choose or test drive your selected vehicle
Apply
Apply with your employer’s nominated salary packaging provider via your employer
Choose
Choose a lease term option to suit your lifestyle needs (select from 1 -5 years)
What may be included in a novated lease?
Upfront costs
- Car price and accessories
- Dealer delivery charges
- First-year registration and CTP insurance
- Comprehensive insurance
- Purchase stamp duty
- Novated lease establishment, origination and/or brokerage fees
- Personal Property Securities Register registration fee
- Luxury Car Tax (if applicable)
Running costs
- Fuel
- Charging (if it’s an EV)
- Registration and CTP insurance
- Comprehensive insurance
- Servicing, including repairs and maintenance
- Replacement tyres
- Roadside assistance
Eligibility
- Minimum 18 years of age
- Australian Citizen, Permanent Resident or an acceptable work visa holder
- Hold a driver’s licence acceptable in Australia
- Must be employed and able to demonstrate regular income derived from that employment
- Employer must offer salary packaging that includes novated leasing
- Have a good credit history
Things to consider
- Not all employers offer a novated lease, so make sure you check with yours.
- In some cases, a novated lease can attract fringe benefit tax obligations for your employer that could impact you financially. Ask your employer whether this applies to you.
- With a novated lease, you don’t own the car. Instead, you’re paying for the use of the car over a set term with your pre-tax salary.
- At the end of the novated lease, you will need to pay the residual value. When compared to a car loan, it’s essentially the equivalent of a balloon payment.
- Remember to seek independent advice to determine whether this product suits you.
Frequently asked questions
With a car loan, you’d be making repayments with your post-tax salary. With a novated lease, your lease repayment uses some of your pre-tax and if required, post-tax salary, which could lower your taxable income. In addition, unlike a car loan, under a novated lease there is no right or obligation to purchase the vehicle at the end of the lease.
Absolutely! Eligible EVs are exempt from FBT by the Australian Government, so your entire novated lease repayment can be taken from your salary before tax (which could mean tax benefits for you).
Of course, you also get all the other benefits from taking out a novated lease, like having all your car-related expenses bundled into one regular payment.
This could happen if you change jobs, and your new employer doesn’t offer a novated leasing benefit, or you no longer work for the employer you originally set up the lease with.
- You’ll be responsible for making all lease repayments directly to us and continue with the finance component of your arrangement.
- Keep in mind that you will no longer have the rest of your package – such as insurance, tyres, servicing, fuel etc – and your lease repayments will be paid post-tax, so any pre-tax benefit will no longer apply.
- You remain obligated to comply with the terms and conditions of your lease, and the residual value will still be due at the end of your lease term. You’ll also need to ensure that the vehicle is comprehensively insured and registered, and that Angle Auto Finance is noted as having a financial interest in the vehicle.
If you’re transitioning to a new employer offering novated leasing benefits, you’ll still need to cover your ongoing lease repayments in the meantime. Until your new employer has completed the novated lease set up, your lease repayments will need to be made directly to Angle Auto Finance.
When your lease is close to coming to an end, you’ll be given a few options:
1. Offer to buy the vehicle
You’ll need to contact us for a payout figure.
If your lease is still managed by a salary packaging provider, contact your provider to discuss your options regarding refinancing your existing vehicle or entering a new lease for a new vehicle.
2. Pay the residual value on the last day of the term and return the leased vehicle
You’ll need to contact us to discuss the best way to return the vehicle and arrange for payment of the residual value.
A novated lease is based around a fixed length of time. So, if you decide to end the lease early, your payout might be higher than the market value of the car (and could include fees and charges from us as the finance provider).
When you set up your lease, it’s a good idea to structure it over a period that reflects how long you’ll want to keep the car to avoid any of those early termination related costs.
The payout figure is the amount you would need to pay to buy the car or pay off the remaining balance if you end the lease early. It includes the remaining monthly payments, residual value and any early termination costs. At the end of your lease or at any point during your lease, if you tell us you’d like to the buy the vehicle, you’ll be sent a letter with the payout figure.
- The payout figure will display the total amount payable, including GST, and any fees and charges that may apply. See our fees and charges guide.
- The payout figure is valid until the date specified in the letter. If we don’t receive payment by this date, the amount required to buy the vehicle may change according to the actual payment date.
- You will receive information on how to pay the payout figure, including the dedicated bank details.
When you pay the full payout figure by the payout date and once the funds have cleared:
- The title to the vehicle will transfer to you from us on an ‘as is, where is’ basis and we won’t have an interest in it anymore.
- To the extent the law permits, we don’t make any promises about the vehicle, like where it is, its use, condition or suitability to you. You’re responsible for all these things, as you’ve had the vehicle during the lease term (not us). Any liability we have or rights you may have in connection with the vehicle (other than set out in the lease with us) are excluded.
- We’ll release any security interest registration (such as in the PPS Register) we have made against the vehicle within five business days.
A novated lease residual value is the amount you are contractually required to pay at the end of a novated lease. When compared to a car loan, it’s essentially the equivalent of a balloon payment, representing the vehicle’s estimated remaining value, and is calculated as a percentage of the original vehicle price as determined by the Australia Tax Office (ATO), with the percentage decreasing as the lease term increases.
The payout figure is the amount you would need to pay to buy the car or pay off the remaining balance if you end the lease early. It would normally be more than the residual value as it includes remaining monthly payments, before the lease ends as well as applicable costs related to early termination.
Important information
For details of the Australian Government’s FBT exemption on electric cars, see: Electric cars exemption | Australian Taxation Office
This page contains general information only and is not intended to be relied on as advice. Before making any decisions, you should consider whether it is appropriate to your circumstances and seek independent taxation advice.
Approved applicants only. Credit criteria, fees, charges and terms and conditions apply. Finance issued by Angle Auto Finance Pty Ltd ABN 16 161 130 696 Australian Credit Licence 530731. Angle Auto Finance Pty Ltd ABN 16 161 130 696 is a portfolio company of Cerberus Capital Management, L.P.