Thread: novated lease advice

Originally Posted by 4x4_bugsy

Dont kid yourself, it will always cost you more to lease a car than to buy it.

The key to it is the running costs. Paid from pre tax dollars.. Adds up over 10 years.
I would have put around $32,000 worth of fuel into my two defenders over the last 10 years. 10 bridgestone tyres $3500. Servicing (too scared to add that up over 10 years) Rego $6500. RACV membership. Insurance...etc etc.

Running a car is not just purchasing it.

Novating a car can be worth while if you do the km's. That said as mention previously its transitioning to a flat rate which is totally ****.

What a lot of people also forget is its GST free, on a $50k car thats $5k saving straight up, then fuel less GST, servicing etc. Not to mention the most important - PRE TAX dollars. this all adds up!

No doubt you need to do the sums, because FBT is a killer on lower bracket incomes. The ECM method can relieve the FBT, but you are still using post dollars to offset.

If you are serious, i would go see your accountant, not the Fleet company advice. The accountant will look at your income vs expense and work out your true net cash savings.

Once you have done those sums, look at the company car option vs lease and see your net cash difference.

Remember its about the net cash at the end of the day.

Dorko