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Associate Lease
Save on income tax and running costs of your family car owned by an associate.
Use your family-owned car to take advantage of tax savings on running costs.
A little-known way to save on vehicle costs is to set up an associate lease. This allows you to rent a vehicle that’s owned by an associate (eg adult family member) to your employer, who in turn makes the vehicle available to you as part of your employment. Because the running costs are deducted from your pre-tax salary, you won’t pay tax on these. Considerable savings are possible, as your associate may also be able to claim running costs and depreciation as a tax deduction.
Use your family-owned car to take advantage of tax savings on running costs.
An associate lease is where your associate (partner, spouse, adult child, family trust and similar) owns a motor vehicle out-right, or even under finance, and enters into an arrangement to rent that vehicle to your employer (who pays your associate the rental costs including running cost: petrol, maintenance, tyres and so forth) who then makes the vehicle available to you as part of your employment. The costs are deducted from your pre-tax salary (so you don’t pay tax on the amount – this is the saving) and paid to your employer, who then pays your associate. The money stays in the family, but the running costs are tax-free. Your associate will record the income on their tax return, but also be able to claim the running costs and depreciation as income tax deductions. Depending on the relative differences in salary between you and your associate this can be a great way to save on existing family vehicles.
How to start packaging
· Contact us for further information
· Discuss details with your associate’s tax advisor to ensure you will benefit from the arrangement
· Complete a simple application form listing the vehicle details and associate’s name
· We will arrange the legal agreement between your employer and your associate
· Enjoy the tax savings
How Much Could I Save With Salary Packaging?
Using your pre-tax salary to pay for things allows you to increase your disposable income and pay less tax – often thousands of dollars less each year. There are dozens of items you can potentially salary package, but some depend on your employer and the industry they work in.
It’s all fully approved by the Australian Taxation Office, however it pays to seek specialist clarification from us to ensure you gain everything you’re entitled to, and make the process of setting up your package easy. You can use our calculators for indicative savings, or talk to us today to find out more and the next steps to take towards saving!
Calculate Your Savings
Your New Car
Salary packaging your next car is a good decision; see how it can work for you. Call 1300 303 357 and speak to one of our friendly specialists.
Get In Touch!
Find out how much you can save on a new or used vehicle with a novated lease through SalaryMasters. Enter your details and we will get in touch with you shortly.
