An employer agrees to take on the finance for a car from the finance company for a fixed period of time. The employer then takes the repayments out of your "pre tax" salary, doing a salary sacrifice thus reducing your taxable income. While the contract for the finance is between the employer and the finance company if you change jobs, you take your novated lease and your car with you.

At the end of the term of the novated lease you may have the option to purchase the car for a residual, or you can sell and trade. If you find you make a profit from selling the car, then it's your to keep!

There are two kinds of novated leases:

1. Fully maintained novated Lease - where all the operating costs of the vehicle are covered, such as car_insurance, vehicle registration, fuel, tyres and servicing. In this instance you pay a regular monthly payment, and the leasing company covers all maintenance expenses.
2. Non-Maintained novated Lease - when you are responsible for all operating expenses associated with the vehicle.

There are numerous benefits of a novated lease, including:

• The ability to cost-effectively package the motor vehicle of your choice. This process is completely flexible and only limited by how much you are able to allocate from your salary.
• The car is yours to use 100% of the time, it's not a company car
• Repayments can be fixed over a period of 1 to 5 years
• As all costs are paid in pre-tax dollars, vehicle salary packaging can be tax effective.
• As a car purchased under a novated lease often qualifies as a company car it may come under a company fleet discount
• Monthly Vehicle Reports that outline important information on how the vehicle is tracking to the program. For added convenience, these reports are emailed directly to you.
• The lease is portable and may be re-novated from one employer to another (depending on employer acceptance).