An associate lease means, instead of taking a loan with a finance provider for the purchase of the car, you lease a car from an associate (typically a spouse, partner, relative or family trust). Your employer makes deductions from your pre-tax and post-tax salary to cover your lease and running costs. We then arrange for the lease repayments to be transferred to the associate.
The associate must own or lease the car. They also need to have an ABN but not be registered for GST. They must declare these lease payments as income and this income plus any other non-salary income cannot exceed $75,000.
The vehicle must qualify as a ‘car’ for FBT purposes, which means it must be either:
You can still include your running costs such as fuel, insurance, rego and servicing with an associate lease.
We arrange to buy your current car at an agreed value*. There’s no restriction on how you use this money. We then help you finance the car and all the running costs via a novated lease. Your payments are deducted from a combination of your pre and post-tax salary, meaning you enjoy the tax savings and convenience of a novated lease, without the hassle of buying a new car.
* The agreed value will be the market value, which can be obtained via https://www.redbook.com.au/