sgfleet have developed a range of Frequently Asked Questions to assist with general enquiries.

What are the responsibilities of a driver of an sgfleet vehicle?

1. Ensure the owners manual of the vehicle is read and understood

2. All vehicle drivers must have a current and valid licence

3. All vehicles must have a valid registration label displayed (where provided by the relevant registration authority)

4. Whenever possible, the vehicle should be parked under cover to avoid extreme weather conditions and hail damage

5. For reliable operation of the motor vehicle, it is a requirement that the following checks be performed on a weekly basis:

  • Oil and coolant levels (refer to owner’s service manual)
  • Tyre condition and pressure
  • Windscreen washer fluid level
  • Battery fluid level (when not a sealed unit)
  • Brake fluid level
  • Operation of lights

6. The vehicle is to be serviced at the manufacturer’s service intervals (refer to owner’s service manual)

7. The driver is required to regularly clean the vehicle and maintain its appearance. Cleaning entails washing, polishing and vacuuming and should be undertaken as necessary. Bird droppings will cause damage to the vehicle paintwork and will cause a disproportionate loss of value to the vehicle. Any bird droppings should be removed as soon as possible

8. Vehicles returned to sgfleet under an operating lease arrangement must be in satisfactory condition relative to the vehicle’s age and distance traveled. To find out more, please refer to the Fair Wear and Tear guide

What does the lease include?

The lease inclusions are contained in the lease documentation. For verification of what the lease includes, please contact sgfleet via email on enquiries@sgfleet.com

 

What happens at lease end?

When the contract ends, sgfleet will arrange a convenient time for the vehicle to be returned. A vehicle condition report noting any damage will be completed at vehicle handover. Any accessories supplied with the vehicle should be returned, including vehicle service books, all keys and satellite navigation discs. Items not returned may incur an unfair wear and tear charge.

Vehicles returned to sgfleet under an operating lease arrangement must be in satisfactory condition relative to the vehicle’s age and distance traveled. To find out more, please refer to the Fair Wear and Tear guide

The driver or family and friends of the driver may make an offer to buy the vehicle at lease end. To find out more about this process, please call the sgfleet driver assistance line on 1300 138 235.

What is the Luxury Car Levy?

Where the amount financed of a Novated Lease is greater than the Luxury Vehicle Limit ($57,466 effective on 1st July 2014)  set by the Australian Tax Office (ATO), the ATO does not allow an employer to claim the full lease rental as an expense for taxation purposes. The Luxury Car Levy offsets the effect of this reduced expense claim.

Note that the Luxury Vehicle Limit is not the same as the Luxury Car Tax threshold.

If an employee has salary only, the employer’s total expense claim for taxation purposes is only an employee's salary amount.

If an employee has a Novated Lease, then the employer’s total expense claim for taxation purposes is the reduced salary plus lease rental amounts.

If the Novated Lease has an amount financed greater than the Luxury Vehicle Limit, the employer’s expense claims are lower which results in higher taxable income. Consequently, their tax payable will be higher.

The Luxury Car Levy calculates an additional amount to be paid by the employee to the employer to offset their amount of additional tax.

Example

If an employee's salary without a Novated Lease is $100,000 pa, the employer will claim for taxation purposes expenses of $100,000.

If a Novated Lease is taken with lease rentals of $1,000 per month ($12,000 per year), the salary would normally be reduced from $100,000 to $88,000, and the employer would claim for taxation purposes expenses of $88,000 for salary and $12,000 for lease rental. This is a combined total of $100,000 and would be the same as if a Novated Lease had not been taken out.

If the amount financed of the Novated Lease was over the Luxury Vehicle Limit, the employer may only be able to claim $10,000 of the lease rentals as an expense for taxation purposes. The total claim would now be just $98,000 and they would have a tax liability on the $2,000 difference, say $600. The Luxury Levy offsets this additional tax liability.

 

Note: The calculations in the example above are not purported to be accurate and are for illustration purposes only. sgfleet does not provide legal, financial or tax advice. Employees and employers should seek independent advice regarding Novated Leasing. Employers are able to vary any salary sacrifice amounts advised by sgfleet, including the Luxury Car Levy, if they consider it appropriate.