Salary Packaging is an entitlement granted by the Federal Government to all employees, allowing you to receive a portion of your income as a tax-free benefit. Salary sacrificing effectively reduces the employees’ taxable income, and can offer a more flexible remuneration structure. Salary packaging a vehicle is known as a Novated Lease.
Benefits for an employee of salary packaging their vehicle:
- Reduced income tax;
- GST savings on vehicle purchase price;
- GST savings on running cost expenses;
- Fixed deductions each pay period, regardless of actual expenses incurred from day to day
- Access to corporate fleet discounts when purchasing new motor vehicles;
- Access to servicing and maintenance discounts through select merchants;
- Flexibility and choice – cars, merchants, insurance companies and lease terms;
- Access to free vehicle sourcing service;
- National fuel and maintenance network;
- Direct and permanent access to personal consultants; and
- Full cost transparency and reconciliation
N.B. Tax savings and benefits will vary for each employee, depending on personal circumstances such as gross incomes, annual kilometres, cost of vehicles and lease periods.