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Novated Lease: Should I Consider It for My Staff?

9 June 2021 AutoMarket, Petrol saving tips

Should you offer a novated lease to your staff?

If you are looking for a way to recognise your employee’s hard work, you may probably want to offer a novated lease for them. However, the question is, when is it a smart option for you to offer this kind of a deal?

 

1. If your staff deserve this kind of reward.

Of course, a hard-working employee deserves a reward. This will also serve as a good motivation for your staff to bring their best in doing their job.

 

2. If you spent a lot of time training this employee and you feel that your business will be lost without him/her.

Setting up a novated lease not only encourages your employee to stay with you because you’ve been nice but they will also hang around so their car repayments will be taken out of their pay packet.

 

3. If your employee does a moderate amount of work-related travel.

You may want to consider leasing a company car that they use for work purposes only, this will also depend on the size of your business and the nature of your work.

 

4. If you have a tight budget to reward your staff.

You cannot raise a reward for your staff if your budget is tight, it is more practical if you consider a novated lease instead of monetary bonuses.

 

5. If you want your employees to do some work-related driving but want to save hassles and paperwork regarding assets and liabilities.

Basically, a novated lease car doesn’t count as an asset or a liability for you and your company, and that means you can leave these vehicles off the balance sheet.

 

6. If you want to claim an extra input tax credit. 

You get to claim an input tax credit on any GST paid as part of a novated leasing a car.

 

Setting up a novated lease for your employees doesn’t always come with a smooth transaction, it also has lots of ins and outs, and if you have other questions you want to ask about the process, know that that’s what we’re here for – you can ask us more details about novated lease and whatever else you may need assistance with!