Financing a new car with a Novated Lease is growing rapidly in Australia. A novated lease can be a tax effective way to purchase a new car.
While you are saving with a Novated lease, make sure you get a competitive car insurance solution from Progressive within that package to make sure you are maximizing your savings over the life of the lease.
Learn more about how you can save with a novated lease on your next new car.
The Treasurer of Australia announced in 2011 that reforms to Car Fringe Benefit Rules will remove the unintended incentive for people to drive their novated lease vehicle further than they need to, in order to obtain a larger tax concession.
In essence, instead of a fringe benefit rate increasing for lower annual kilometres, the reform will mean all novated leases will have a flat fringe benefit rate of 20% applied to the value of the vehicle, regardless of annual kilometres driven.
This has made Novated Leases more accessible for a broader range of motorists that do not drive high kilometres. Allowing families to benefit from tax savings, without the need to achieve high mileage on their new car.
With this growth in Novated Leases, Progressive has made it easy for people with Novated Leases to access a lower cost car insurance solution within their novated lease.
Typically with a Novated Lease, the package can include car insurance by the provider. However, this can be significantly more expensive than other more competitive car insurance solutions available.
With Progressive, we have made it easy to get a 100% online car insurance price, and use this within your Novated Lease package.
Upon completing this process, your Novated Lease provider will package the cost and reimburse your payment. This way the premium will become a tax deduction, hence reduced by your marginal tax rate and Medicare Levy.