Salary Packaging, otherwise known as Salary Exchange, is the inclusion of employee benefits (otherwise known as fringe benefits) in an employee’s remuneration package.
With salary packaging, an employee exchanges part of his salary for a vehicle.
How Salary Packages Work
The Australian Tax office has approved of companies allowing an employee to use part of his pre-tax salary to pay for goods and services, in this case, a vehicle. You may ask why salary packages have proven to be so attractive to employees.
The answer lies in the reduction of an employee’s payable tax and a corresponding increase in his take-home income. Salary packages allow you to pay less income tax (known as Fringe Benefits Tax) than you usually would on purchased vehicles. Conversely, your take-home income will rise.
SALARY PACKAGING Why Our Salary Packages will Benefit You
Employers offer salary packages as a way to reward their employees for their hard work. Here’s why you should get one set up if your boss has them available.
1. Reduces expenses
Novated lease salary packages allow for substantial savings. You save on both tax and the operational costs of your vehicle.
2. Tax Savings
You make novated lease repayments with a combinatorial of pre and post-tax dollars. You will lower the amount of tax you pay. Also, you will not have to pay the GST on your new vehicle, which decreases the payable amount by ten percent.
3. Saving On Operational Costs
The costs to keep your car on the road are relatively high. A novated lease helps pay for items like fuel, tires, maintenance, and insurance with a combination of pre and post-tax dollars.
4. Financial Management
Because your operational costs are payable in monthly installments instead of lump sums, you will have enough money to fund insurance and other expenses.
Why Choose PaR LEAsING TO SALARY PACKAGE YOUR CAR?
With over 40 years of industry experience, we understand the financial needs of car owners. Our consultants have the expertise required to secure a salary package that suits you.
Our attention to detail has earned us the trust of Melbourne’s residents. We have an endless number of employees packaging with us.
Our experts go the extra mile to devise financial solutions for clients’ cars. The community of Melbourne is our passion; we take care of it, and its vehicles.
- Professional integrity
- Customer satisfaction
- and Quality
Frequently Asked Questions
1. Do I drive enough to benefit from a salary package?
A salary package will benefit you, whether you drive 10 000 or 50000 km a day. You will save on tax as well.
2. What happens if my financial circumstances change?
We will prompt you to increase your monthly payments to finance the extra amount should you need to increase the lease amount. Further, we will reconcile your account should we discover that you’ve spent more than necessary.
3. How long will it take Par Leasing to approve my application?
Our forms are easy to complete. We will typically approve your application within a few hours.
4. When will the salary package take effect?
Your salary contributions will start depending on your employer’s cut-off date for adjusting your pay.
5. Describe Sale and Leaseback
Sale and Leaseback let you enjoy the benefits of a novated lease on your existing vehicle. Par Leasing will purchase your car for the equity left in it.
You may enjoy the benefits of salary packaging even if you don’t need a new car. You can also retrieve the equity on your vehicle to use as you see fit. Sale and leaseback allow you to enjoy the peace of mind that comes with knowing that Par Leasing manages your car’s servicing and maintenance.
6. Is SALARY Packaging a more viable alternative than a car loan?
You don’t pay GST on the purchase price of a car when you make it part of a salary package. We have a wide range of vehicles, and you won’t have to pay GST on them.
You will enjoy tax savings and access to Par Leasing’s extensive network of car manufacturers. Rest assured that our third-party prices are competitive.
7. What happens if I change jobs?
You may choose to pay for the vehicle, continue paying for the lease yourself or transfer it to your new employer.
8. Are there cars that I cannot lease?
Some employers have a list of cars that their employers can lease. You may set up one for a vehicle you already own.
9. Can I set up multiple novated leases?
You can set up leases for any number of cars.