One of the most common fringe benefits provided to employees is a Novated Lease
vehicle, because it can not only provide almost any employee with significant tax
savings, but it also assists employers in eliminating or reducing the need to own
and manage a fleet of vehicles.
By offering Novated Leases, the employer no longer needs to own or lease vehicles,
which removes them from the balance sheet.
Advantages of Off Balance Sheet Vehicles:
Improved Financial Performance
Eliminating or reducing your organisation’s owned or lease vehicles can provide
improved returns on shareholder funds and free up capital (instead of being tied
up in a pool of depreciating vehicles).
This is equally important whether you are in the private sector or a Not For Profit
entity, as in each case it will allow funds to be invested in your core activities.
No Unwanted Vehicles
As a novated lease vehicle is not purchased or leased by the organisation (instead
it is leased by the individual employee), the employer is only responsible for the
lease payments (deducted from the employee’s salary) whilst the employee remains
in their employment.
Ultimate responsibility belongs to the employee, who takes the vehicle and responsibility
for lease payments with them if they leave their employment. This prevents employers
from being caught out with unwanted vehicles when an employee leaves, and removes
any risk or implications for the employer of vehicle selection on the future resale
value.
Vehicle Management Program
All Novated Leases salary packaged by Southgate operate under our Vehicle
Management Program, meaning that the employer has no costs or burden in
the vehicle selection, daily running of the vehicle, or vehicle disposal.
Southgate assists employees to select an appropriate vehicle and provides a fully
maintained quote which budgets the vehicle running costs over the term of the lease.
Once implemented, Southgate’s Vehicle Management Program takes care of the day-to-day
management of the vehicle and the entire cost is deducted from the employee’s salary.
Visit Novated Leasing to learn more about the benefits
of offering Novated Leases to your employees.