An Alphera Novated Lease can be both cost and tax-effective, as the employee gains the benefits of the lease payments, running costs and Fringe Benefits Tax being paid from pre-tax income.
 
What is a Novated Lease?
A novated lease is a three way agreement between the employer, employee and Alphera Financial Services, and works as follows: The employee decides what type of motor vehicle they want, ie: new or used, sedan, wagon, 4x4, sports coupé etc, and after selecting the particular vehicle to suit their needs, enter into a finance lease with Alphera Financial Services.

The employer, employee and Alphera Financial Services all sign a Novation Agreement, whereby the employer agrees to take on the employee’s obligations under the lease. Under this arrangement, the employer makes the monthly lease payments, and provides the vehicle for the employee to use as part of a salary packaging arrangement. Should employment cease for any reason, or the lease agreement reaches maturity, the Novation Agreement ceases and the obligations assumed by the employer, revert back to the employee.
 
Benefits of a Alphera Novated Lease Choice of vehicle
As a salary packaged vehicle is not part of the company fleet, employees can choose the make and type of vehicle (new or used) that best suits their needs.
 
The vehicle and finance lease are portable, and should an employee change jobs, they take both with them and simply enter into another Novation Agreement with their new employer, and Alphera Financial Services.
 
As the lease is in the employee’s name, and lease payments are deducted from their salary package, they can realise any equity built up in the vehicle over the duration of the lease.
 
Through salary packaging a vehicle via an Alphera Novated Lease, employees can benefit from requiring a smaller portion of their income to run the vehicle, and enjoy a lower rate of tax on the benefit, than if they were to pay for the running costs of the vehicle using after tax income.

Motor vehicles can be an attractive component of any remuneration package because they are concessionally treated for Fringe Benefits Tax purposes.




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