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How novated leasing works

Learn how you could save on tax by salary packaging a car.

Closeup of red car in a showroom

About novated leasing

Novated leasing is ATO-approved and may help reduce the income tax you pay. It’s a three-way agreement between you, your employer and a finance company – with Smart™ doing the legwork to make things simple.

Use our calculator to see if your employer offers novated leasing.

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How to
Ways to save
EV savings
FAQs

Simple steps to lease a car you love

1. Compare cars and calculate savings
  • Get quotes for your preferred car and accessories, and different lease terms.
  • Compare savings against other options like a car loan or buying outright.
2. Lock in a great deal
  • Apply online for finance, with a usual 24-hour turnaround time, subject to credit check.
  • Sign your contract, and we’ll source your car at a great price through our 740-strong dealer network.
3. Take delivery and hit the road
  • Enjoy the freedom and pleasure of having a new car, while we take care of salary deductions and payments.
  • Start getting the big income tax savings possible with a novated lease.

Ways you could save

A novated lease with Smart helps you drive your salary further in many ways. 

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Save tax when you buy

Check out our calculator for latest deals, and take advantage of our dealer network for competitive prices. For a new car, you instantly save an extra 10% as there’s no GST on the purchase price with a novated lease.^

close up photo of an EV being charged
Save tax as you drive

Use your pre-tax dollars to pay for things like insurance, registration, fuel, maintenance and other running costs, such as car wash expenses. On top of this, you can get fleet pricing on your car’s servicing (including parts and labour) through our Vehicle Maintenance Program (VMP).

rows of cars in a showroom
Save time and hassle

To help you get behind the wheel sooner, our complimentary car buying service can source and purchase a new car on your behalf. We can also arrange zero-pressure test drives, and even offer a Vehicle Disposal Program when it’s time to sell your car.

Save even more tax with an electric vehicle

If you lease an eligible electric vehicle (EV) or plug-in hybrid (PHEV), 100% of the lease and car costs come from your income before tax.^^

So not only could you get the carbon efficiencies and amazing technology of an EV low-emissions vehicle, you could save thousands of dollars each year.

Tesla driving through a city

Learn more at a webinar

Find out more about how novated leasing works and how it could help you save 

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We’re here to help

FAQs

How is a novated lease paid for?
Is the car registered in my name?
Can novated leasing be cheaper than a car loan or cash?
How do novated leases for electric vehicles and petrol-fueled cars differ?
Do I get a fuel card and how is fuel priced?
What if I drive my car for business?
What options do I have at the end of the lease?
How is the residual (‘balloon payment’) calculated?

Visit Smart FAQs for more answers

Important information

This is general information only. Before entering into any salary packaging or novated leasing arrangement, you should consider your objectives, financial situation and needs, and seek appropriate legal, financial or other professional advice based upon your own particular circumstances. The availability of benefits is determined by your employer. Conditions and fees apply. Smartsalary Pty Ltd, ABN 24 096 796 100, a SmartTM company.

 

^GST is not payable on the purchase price of a vehicle financed through a novated lease (GST savings are calculated on the FBT base value of the vehicle, up to the claimable limit [$6,334 in FY 2024-25] unless exempt). 

^^ Fringe Benefits Tax (FBT) exemption available for eligible electric, plug in hybrid or hydrogen cell vehicles purchased through a novated lease up to the Luxury Car Tax limit ($91,387 in FY 2024-25). Plug-in Hybrid Electric Vehicles will only be eligible for the exemption if a quote is signed and returned to us on or before 31 March 2025.