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What You Need to Know About Novated Leasing Companies in Australia

What Is A Novated Lease?

A novated lease is a type of vehicle lease offered by employers as a part of your salary package. It is a financial arrangement wherein the employer pays for the car and its running costs from your pre-tax earnings and post-tax salary deductions.

A novated lease can help you save thousands of dollars on the car’s purchase price and maintenance.

Popular Novated Leasing Companies


Google Rating: 128 reviews

Maxxia is the largest provider of employee benefits in Australia and is part of the ASX-listed McMillan Shakespeare Group, which started the salary packaging in the country in 1988.


Google Rating: 1,302 reviews

RemServ is a leading provider of salary packaging services in Queensland and has 21 years of operation.

NLC Novated Lease

Product Rating: 136 reviews

NLC is part of the SG Fleet Group Company, which is the leading provider of vehicle solutions, vehicle leasing, and salary packaging across Australia.


Product Rating: 506 reviews

Fleetcare is an independently-owned company that operates nationwide with over 42,000 vehicles for private, public, commercial, and industrial purposes.

Smart Salary Novated Lease

Google Review: 442 reviews

It is one of Australia’s largest salary packaging companies that service more than 200 organizations, including large corporations, major healthcare groups, and government institutions.

Statewide Novated Lease

Google Rating: 3 reviews

Statewide Novated Leasing Pty Ltd is a novated leasing services provider of Queensland Government employees for 18 years now, as approved by the Queensland Government.

SG Fleet Novated Lease

Google Review: 15 reviews

SG Fleet is a leading international mobility solutions provider that employs over 700 staff, and manages over 140,000 assets.

Autopia Novated Lease

Product Review: 19 reviews

Founded in 2004, this novated leasing company has been helping individuals and organisations save money by helping them buy, sell, and use vehicles using the most tax-effective ways.

RACV Novated Lease

Product Rating: 26 reviews

RACV Finance has wide range of car finance options that allow quick and easy application for car loans. It also operates in the transport, home, travel, leisure, and retail sector.

Orix Novated Lease

Google Review: 18 reviews

It is a publicly-owned global financial services company found in 1964, which a headquarters based in Tokyo. It has $1.5 billion assets and 325 employees across Australia and New Zealand.

Fleet Partners Novated Lease

Google Review: 3 reviews

For almost 30 years, they have been providing fleet management and vehicle novated leasing to clients. As of now, they have 55,000 vehicles on the roads of Australia.

With almost 30 years of experience in vehicle leasing and fleet management, we keep more than 55,000 vehicles on the road across Australia.

Stratton Novated Lease

Google Review: 16 reviews

It is a publicly-owned global financial services company found in 1964, which a headquarters based in Tokyo. It has $1.5 billion assets and 325 employees across Australia and New Zealand.

Leasing a car or truck has become one of the payment vehicles of choice in today’s economic climate. It is particularly favoured mainly because it provides an appealing way to drive a new vehicle which you might not be able to afford through typical financing programs; it may not otherwise be affordable.

Leasing places you in a unique position – it enables you to make more affordable monthly payments as compared to conventional automobile finance loans.

In today’s market, approximately one out of every four vehicles being driven by motorists in Australia is actually leased.

The typical perspective of most automobile purchasers is that the dealership from which the car is purchased from is also doing the lion’s share of the leasing; this is rarely the case. The vast majority of dealers function as intermediaries – brokers and middlemen – for the car maker’s finance company or third-party bank or lending institutions. While it may certainly be possible to lease your vehicle from the local car dealership, you can likely save money by leasing through an independent leasing company or even directly through a bank.

Most dealers typically view leases as additional tools to help aid them in making the sale. The dealership wants to shift the thinking of a prospective buyer from one that is centred on the selling price of the vehicle to a focus on the monthly payment amount. This shift is logical for the dealer to do – the monthly instalments will always be a small fraction of the selling price. Leasing allows them a great deal of latitude in making the vehicle seem affordable by being able to vary lease terms that may include: time, rate, mileage allowances and other factors.

Independent Leasing Companies

Every metropolitan area has its own stand-alone, non-affiliated leasing company that can offer leasing solutions to a wide range of purchasers that can also be corporate fleet customers. These businesses and their leasing agents will always be in the role as brokers or middlemen; the approvals of the actual financing will always be provided by a bank or other lending institution specialising in these kinds of purchase arrangements.

The Direct Bank Lessor

Leasing directly from a bank is sometimes beneficial. When this option is deemed best for you, there are no middlemen; your contact and the leasing will be done one on one with the bank. There will usually be numerous banks and other financial institutions that can offer a leasing product that will meet your guidelines for monthly payment amounts, term and all of the other considerations.

It is also important to note that a third-party lessor will not usually sell your lease agreement to a bank. They are authorised as the leasing company with the vehicle manufacturer, which means they have complete access to all of the information about the vehicle – this includes wholesale confidential pricing. When you combine this capability the lower costs of the funds, they are often in the best position to offer you a lease at the lowest possible cost.

Popular Novated Lease Car Brands

Toyota Novated Lease

The novated lease offered by Toyota Fleet Management has a simple application process that takes only 5 working days. TFM is an expert partner in fleet management, fleet management, and other transport needs. They have a direct access to Toyota Finance, the parent company that provides funding, which means you can get competitive rates and great deals.

BMW Novated Lease

BMW Finance can assist to in acquiring a new BMW fast, in the most tax-effective way. BMW experts have created solutions that meet your individual needs. To help customers save more, they do not charge accounting fees. For almost 50 years, they have been at the forefront of automotive finance around the world.

Mazda Novated Lease

Mazda Finance offers flexible payment options for individuals and organizations. They tailor the interest rate as they calculate your individual circumstances. MF is noted for transparency and personalized customer care. They offer loans ranging from 12 to 72 months in length, subject to company policy and approval.

Audi Novated Lease

For more than 65 years, Audi has made automobile financing and leasing flexible, efficient, and simple. They also offer finance solutions that are tailored to your budget, lifestyle, and credit score. Their fleet leasing solutions covers vehicle sourcing, price negotiation, procurement, delivery management, and maintenance management.

What Are The Advantages Of Novated Lease?​

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Post Tax Salary Benefits

Novated leasing allows you to save a lot of money through post-tax salary benefits. This means your employers pays for the car and its running costs through your pre-tax earnings.

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Vehicle models under novated lease are covered by warranty. This means you won’t have to worry about repairs and maintenance. You can even upgrade the vehicle before or at the end of your lease.

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Most novated leasing companies handle the procurement, registration, maintenance, and other services to lessen the customer’s burden. Some even offer 24/7 roadside assistance.

What Are The Disadvantages Of Novated Lease?

The Vehicle Is A Liability

Unlike a company vehicle that can be returned after your service, the car goes with you when you part ways with an employer. This means all the financial obligations are yours.

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Employer Approval

Since a novated lease is a 3-way agreement, you need to get the approval of your employer for the vehicle that you want to buy or lease.

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Requires Outstanding Credit Score

With all the advantages that a novated lease has to offer, finance companies practice extreme caution when approving clients.

Novated Lease vs Car Loan

Unlike novated lease, the maintenance and running costs of cars acquired through a lone are carried by the owner from your post-tax earnings. But with a novated leasing company, you can get the car at lower price through their connections and budgeted running costs. It can also be difficult to sell the car later on without the help of a well-connected finance company.

Novated Lease vs Buying Outright

A novated lease is a more practical option if you’re constantly travelling with a huge mileage, as it offers easier budgeting for repairs, maintenance, and fuel—and they are all part of your pre-tax payments. And because the car is acquired through a 3-way agreement using your pre-tax earnings, you can save more through a novated lease than buying the automobile outright.

Novated Lease vs Chattel Mortgage

A chattel mortgage is advised if the vehicle is for daily business us so that your business can claim back the purchase and running cost. Although this type of mortgage gives you the ownership from the beginning, offers substantial tax deductions, and flexibles options, you have to pay for all the maintenance and running costs.

Most popular questions

Fringe Benefits Tax (FBT) is a type of tax paid by the employer on certain benefits they provide the employee with.

With a novated lease, your employer pays a portion of the car payments from your pre-tax salary. This means a portion of your salary before it enters your and goes to your car-related expenses. This also effectively reduces your income tax.

The interest rates vary depending on several factors, mainly the price of the vehicle. Interest rates on novated lease in Australia can reach up to 10%, and are generally between 5% and 7.5%. But without a middle man, the interest rates through this finance option is better.

A Fully Maintained Novated Lease is a type of salary package that includes a car and its running costs. In this lease, the employee acquires the car and assumes the financial obligations by paying its monthly costs using the employee’s pre-tax earnings.

Sadly, there are finance companies that will try to trick you with the prospect of huge savings but actually has shady doings. Some of them has unclear terms and conditions, surprise charges, and excessively high penalties.

A salary sacrifice novated lease is a finance options that allows you to pay for a new or used automobile of your choice using a pre-tax salary.

Having an outstanding credit history is vital to get approved for a novated lease. Delayed payments and unpaid debts can risk your chances of getting approved for a novated lease.

The residual value is the final amount that represents the value of automobile at the end of the lease, as determined by the ATO. A 5-year lease has a minimum residual value percentage of 28.13% as set by ATO.

   If you want to own an automobile in the most tax-effective way, simply contact Novalease! We offer a wide payment options, flexible payment terms, transparent processes, and professional customer care drawn from our years of experience in field of vehicle leasing.