15 April 2012

It pays to spend some time understanding how Novated Leasing works, and how it differs from other leasing arrangements. In particular, drivers should understand what happens at the end of a lease term.

A finance lease arrangement includes a 'residual value' component. This is a lump sum that the driver needs to pay the financier at the end of the lease term. If the driver decides to sell the vehicle at the end of the lease term, and it is sold for less than the residual value, the driver is still liable for the shortfall between the sale price of the vehicle and the residual value.

In addition, drivers need to understand the way that FBT (Fringe Benefits Tax) is calculated. Contact sgfleet on 1300 138 235 for more information on FBT.