
Get exclusive money-saving offers and guides
Straight to your inbox
Updated
We’re reader-supported and may be paid when you visit links to partner sites. We don’t compare all products in the market, but we’re working on it!
A fully novated lease is becoming a popular source of financing for many Australians seeking to own a car. This method of car financing helps you get a car leased in your name and fully maintained using monthly payments from your salary. Under a fully maintained novated lease, your employer is responsible for your lease repayments and car maintenance expenses, sourcing the money for this from your salary packaging account.
Fully novated leasing takes out the hassle from sourcing a car at a great price. Your employer will usually let you choose the car you want and then help arrange the financing and insurance you need to secure the car.
When comparing vehicle finance options, it's generally helpful to know what monetary figures you are working with. You could use the calculator below to get an idea of the costs involved.
Under a fully maintained novated lease, you enter into a three-way agreement between you, your employer and a financier, where you get to choose a car and have your obligations under the lease taken care of by the employer. This method of financing can suit anyone who wants to own a car, who has a salary package and who drives a significant amount of kilometers each year. The lease will enable you to own a car of your choice, be it new or used, and have it sourced for you so you can use it as part of your salary packaging agreement.
The lease rentals and other operating expenses such as service and maintenance, accident management and insurance, are deducted from your pre-tax salary. These payments are made by your employer on your behalf, but the control of the car and its maintenance remains in your hands.
Related reading: Compare a range of car loan options
A fully maintained novated lease may be a quick way to finance a car purchase, but you have to remember that you will be sacrificing part of your income for the lease repayments and maintenance of the car. This can leave you with less money for other needs such as rent and food. If you do not need a car, either because you do not cover that many kilometers for work or are in a bad financial situation, it is better not to take on the extra debt. You should also carefully examine the cost of the car lease, including the tax implications, interest charges and upfront payments that could make the lease more costly.
A fully maintained novated lease can help you afford a car that you could otherwise not buy with your current salary. Speak to employer to determine whether this option is viable for you.
You may be required to enter the following details:
Picture: Shutterstock
Find the right vehicle for your circumstances with Georgie. Georgie is an Aussie car buying service dedicated to finding the best car for you, at a great price.
If you want a thoroughly practical electric car, the Hyundai IONIQ Electric is one of the most affordable and usable battery-powered models.
Four expert reviews of the Toyota Camry in one
We've ranked every electric car available in Australia right now.
If you're looking for a premium, luxury or performance mid-size sedan, the C-Class has to be on your shortlist.
Audi's Q3 received consistently high marks from car reviewers. It's spacious, highly practical, well-designed, a planted ride, reasonable value for money, built to a high standard and it features superb tech.
The iLoad is a no-frills, uncomplicated van that'll get the job done.
After sitting for a while during lockdown, your car might need a little TLC to coax it back into life. Here's how to get it running again!
It's an Impreza-based SUV, with AWD, a trademark Boxer engine, the option of a hybrid, beefy suspension and ground clearance, and a well-reviewed off-road mode.
Our guide to finding and buying a van will help you pick the perfect model for your business.