If you pay tax and you drive a vehicle, you could potentially save money.
The previous FBT system (pre-2013) required travel brackets to be met, nowadays regardless of the amount of travel you do, you could benefit.
The agreement is fully portable between Employers, if you decide to cease work altogether then you can continue the arrangement personally, without the packaging.
No, an ECM or post tax contribution is used to offset FBT, to ensure that you don’t receive a liability.
If you decide to purchase a new or used vehicle from a dealership or business, the transaction is exempt from GST. Saving you an additional 10% of the initial purchase price of the vehicle.
*If the vehicle is sold or traded, profits above the residual figure are yours to keep, tax-free.10% of the initial purchase price of the vehicle.
This is the amount that the vehicle is paid down to over the term. In line with the ATO regulations and depreciation estimates, this fully transparent amount is set from the start. Many clients consider the residual as an "optional deposit payable at the end" ensuring they aren't depositing their own funds at the start (which is lost in depreciation) and also having access to these funds, if required throughout the term. For the client who would prefer to not have the end of term liability, Positive Salary Packaging has pioneered a residual-free option, whereby additional deductions can be made to ensure there is a $0 balance at the end of the term.
Positive Salary Packaging provides you with a fuel card, which is accepted at 94% of Australian fuel outlets. Registration, Insurance, services, and tyres can be paid by Positive Salary Packaging directly or paid by the client and claimed via reimbursement.
Positive Salary Packaging has an online portal available to clients. Similar to internet banking, the portal will provide you with all the transaction information along with existing budgets and available balances. As the only fixed portion within the agreement is the finance component. Any running costs amendments can be made at any time, free of charge either over the phone or via the portal.
Any funds within the account remain yours. If you wish to withdraw a surplus amount, this can be made via a payroll reversal, any withdrawal is subject to PAYG tax. These funds roll over year to year and can be put towards a new agreement if/when you upgrade your vehicle in the future.
With both the initial and ongoing GST savings as well as the income tax savings directly reducing the costs of buying and maintaining your vehicle, in many cases it could work out less than paying cash for a vehicle. When financing via alternative methods i.e. a car loan or other means, all of the above benefits cannot be obtained for your privately registered vehicle.
We can help set this up for you. Simply speak to your HR or Payroll manager to confirm they are willing to set up or open to discussing in more detail and we can arrange a time for our Sales and Operations Manager to contact them. Key facts to let them know are: It doesn't cost your employer anything, all FBT reporting is completed for them, deductions are paid on invoice each paycycle via a payroll deduction similar to extra superannuation contributions and they will have their own account manager to contact as needed.
The FBT exemption on EVs allows an employee to pay for their vehicle using pre-tax only and not FBT or post-tax offset (ECM).
Your vehicle basically becomes fully tax-exempt (up to the Green luxury car tax limit), as long as it meets the conditions. This means a full pre-tax payment on your finance, rego, insurance, tyres, servicing and charging costs. It also entitles you to claim all the GST costs associated with these expenses via your employer.
Your employer has to process one pre-tax payment to PSP. No reporting, no hassles and no fuss. Talk with our Operations Manager about how easy this is to set up. Phone 1300 946 527.
This is a quick way to help increase an employee's net pay and reduce household costs.
We can contact your payroll and help set up this benefit. If your employer can set up and pay an extra superannuation deduction, they can set up an EV novated lease. We work with all payroll software such as reckon, MYOB and Xero.
Yes, you can claim your electricity costs when using a public EV charging station. Our vehicle expenses card allows you to pay directly from your salary packaging account without having to claim and reimburse. You can also claim charging costs at home if you have a separate meter for vehicle charging in order to separate the household and vehicle costs.
This benefit could potentially reduce your taxable income and reduce the total on your payment summary resulting in a lower taxable income you may receive a Reportable fringe benefits amounts (RFBA) which can affect things such as family tax benefit and child support payments
Hybrid Vehicles still utilise a petrol engine for the majority of power use and the battery engine for low-speed usage eg around shopping centres or on light highway driving, depending on the model.
It costs a lot less in "fuel or charging" costs to run an EV compared to an ICE vehicle, but costs are higher for items such as insurance and tyres. This is due to the higher premiums charges on EVs for comprehensive insurance and the general value of the vehicles being much higher in the initial purchase price. As an example, a Tesla 3 standard attracted an approx insurance cost of $1,600 per annum for a 35-year-old male based in Adelaide.
Positive Salary Packaging has also found a greater cost in tyre replacement and tyre wear with an increase in wear rate of approx. 25% compared to an ICE equivalent. These items are figured in the lease with pre-tax payments. The significant saving is in the charging vs bowser cost, with most drivers saving approx $2,900 per annum in cost.
Most EVs will come with a base-level charging system for your home using a standard 10 amp plug that can be utilised for your vehicle. Many clients simply add the wall-mounted unit for anywhere between $700 to $1,500 plus installation costs dependent on the brand of vehicle. This results in a much quicker charge and allows maximum efficiency when charging your vehicle.
The main model people think of vehicle is Tesla, but there are offerings from MG, BMW, Porsche, BYD and Polestar. Many manufacturers are in the process of bringing new models to the country as the initial sales of EVs start to increase and the national charging network continues to grow.
We believe that as the demand for vehicles grow and more manufacturers bring vehicles for sale in the country, the cost of the vehicles will drop slightly. Along with manufacturers being in vehicles with small car sizing too which will reduce the initial purchase cost.
This will vary on the size of the battery in the vehicle and the rate that it is being charged. Supercharging stations in some cases may be able to charge 50% of the battery within 30mins in some cases. Whilst a slow charging 10 amp fitment could take up 6-7 hours to achieve the same level.
This will vary from model to model but some models are now able to travel up to 600+ kms on a single charge. Most people adopting this technology are CBD or Urban based motorists that are using the car for commuting and on average may only commute 50-100kms per day that works perfectly for them, giving lower running costs and fewer emissions.
Batteries across many of the vehicles currently on the market have warranties of up to 4-8 years dependent on the brand. Long-term battery replacement is yet to be seen on many EVs on a wide-scale basis as the vehicles are so new to the market. This is something that can only be seen in the early hybrid vehicles, that occurred around the 10-year mark. In saying this, the level of technology and battery has greatly advanced in the last ten years, similar to that of mobile phones and laptop computers.
Whilst it may seem dangerous, the battery packs of Australia-delivered vehicles have met all the ANCAP-based requirements and ADR regulations for safety. These are no different in risk from standard petrol ICE vehicle that has 50-60 litres of high flammable liquid in the rear.
Not many of the initial EVs on the Australian market have been designed as towing vehicles, some have the ability for towbar style hitch, but this is more for external storage of items such as Bicycles. We expect this to change as larger more traditional manufacturing brands such as GM and Ford come to the market with more fit to purpose vehicles over the coming 18-24 months.
A great place to start is on the manufacturer's website and national motoring bodies' websites, like everything internet-based forums, can be very one-sided articles based upon personal bias either for or against. Like all vehicles, it's best to go to the showroom and sit, look feel, drive and touch the car to make sure that it meets your end goals.
Your agreement is fully portable between employers. What was once only available to the public service sector, is now available to every working Australian. If you decide to stop working, you can continue the agreement directly with the financier or potentially transfer to a family member or associate.
Any unspent provisions can be withdrawn via your payroll at any time throughout the term. Surplus at the end can be rolled into your new vehicle, if you wish to upgrade.
You are the registered and insured owner of the vehicle therefore the decision of who drives it is entirely yours!
Fringe Benefits Tax does not apply to a novated lease.
No, as long as you pay tax, you will benefit.
There are some restrictions on what used vehicle you can buy. The vehicle has to be considered a passenger car. Therefore, cars such as Cab Chassis 4x2 utes, mini buses and some dual cabs with a payload over 1 tonne, can't be novated.
Lease terms vary from 12 to 60 months and should be matched to the desired length of time that you wish to keep the car. We have lenders that can accept vehicles that are up to 15 years of age at the end of term.
We have lenders that can accept vehicles that are up to 15 years of age at the end of term, therefore giving you the ability to purchase a ten-year-old vehicle and still do a 5-year lease term.
There is no strict limit on the kms on the odometer but the vehicle does not need to meet market value for age, kms and condition.
Yes, it's best to negotiate the vehicle purchase price with the seller, be it a dealer or private seller. It's hard to negotiate a price on a vehicle that we can't see or inspect so this is best left to yourself.
Yes of course, accessories can still be added to your next vehicle as long as they are through reputable suppliers.
When setting up a used vehicle for a novated lease it's best if we can know information such as its current odometer reading and condition so that we can budget correctly for items such as serving, tyre replacement and rego renewal.
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