Salary sacrifice, or novated leasing as it also known, is a three-way agreement between you, your employer and a salary packager. After selecting a car that is right for you, your employer makes lease payments on your behalf to the salary packager from your pre-tax income.
This means that your vehicle and its running costs are paid for over time, rather than requiring funds up-front in the case of an outright purchase.
As we’ve mentioned, salary packaging involves leasing a vehicle from a salary packager, with lease payments made on your behalf by your employer before tax.
What makes salary packaging a car a popular option for many is the potential savings you can make by reducing your taxable income via pre-tax lease payments, which also bundles the vehicle’s on-road and running costs into one regular payment.
Some of the additional items covered by regular lease payments include:
At the end of the novated lease term, you also have the option to return the vehicle, commence a new lease with a new vehicle, or make a final payment (known as a balloon payment) to own the car.
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Talk to your employer about salary sacrificing as an employee benefit. If they don’t offer it currently, you could discuss with them about introducing it as a future benefit.
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If they do offer salary packaging or are happy to introduce it, your employer will introduce you to a salary package provider to set up a lease agreement. If they haven’t already partnered with one, Metro can provide an accredited salary packager.
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If they do offer salary packaging or are happy to introduce it, your employer will introduce you to a salary package provider to set up a lease agreement. If they haven’t already partnered with one, Metro can provide an accredited salary packager.
Contact us to find out more
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Once your vehicle is chosen and your lease agreement is in place, your employer makes lease payments to the salary packager on your behalf from your salary before tax.
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At the end of your term, you can return the vehicle, choose to start another lease on a new car or buy your existing car outright.
If you’re ready to started enjoying the benefits and convenience of salary packaging for your next vehicle, contact one of our friendly team members online or call us on 1300 362 627.
As you’ve probably gathered, what makes novated leases so popular are the benefits they offer in terms of cost savings, convenience and flexibility. Here are the top three benefits that Metro customers enjoy when salary packaging their vehicle:
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Because lease payments are made from your salary before it is taxed, your taxable income is reduced and therefore reduced your overall tax liability.
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The financier, such as Metro, handles all the vehicle management, including any requisite paperwork and documentation.
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should you change jobs, you can transfer the lease to your new employer, subject to their agreement.
At Metro, we’d like to think we’re among Australia’s best salary packagers, and thousands of our happy customers would agree. Here are some of the many benefits of working with Metro to salary package your dream car:
On top of the financial savings and flexibility offered by a novated lease, if you choose an EV salary sacrifice package for your next car you could also take advantage of even more benefits, including:
To be eligible for the above additional benefits, the electric car you choose must be below the luxury car tax threshold.
To find out more about electric vehicle novated leasing at Metro, click here.
Good question – to be eligible for a salary sacrifice package with Metro you must:
Salary sacrifice and novated leasing are more or less the same, in that a novated lease is the process of salary sacrificing a vehicle. You may be able to salary sacrifice other expenses as well, however this would form part of a novated lease financial product.
For most salary sacrificed vehicles, payments will be made from a combination of pre and post-tax income, with the exception of electric vehicles which can be salary sacrificed completely from your pre-tax earnings.
Yes, in most instances with a Metro salary sacrifice package there will be a standard establishment fee of $300, and an origination feed up to $1,000. These fees cover the cost of setting up the lease including the initial application assessment and creating the lease documents.
Yes, however these incentives may differ from state to state. To find out more about government incentives in your state or territory, follow the appropriate link below:
Our team can get you in touch with one of our trusted introducers or salary packager introducers.
