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novated lease

Discussion in 'General Motorcycling Discussion' at netrider.net.au started by BlueRex, May 2, 2007.

  1. Has anyone purchased a bike under novated lease? If so was it worth it.

    i have found an australian company that will do it.

    Not sure if i can put the link up..

  2. A lot will also depend if your employer allows bikes under novated lease. By all means put the link up :?
  3. Not sure novating a motor bike would be worth it.

    The bike would not attract the same classifications as a car so would therefore be classified as an expense fringe benefit and the fbt rate on that would cancel out any potential benefits.

    If the bike could be classified as a motor vehicle for FBT purposes, then as long as you do the klms, then shouldn't be a problem as long as you earn a certain income level.
  4. ^^ +1

    much will depend on your employer. I have no hope in hell :(

    Also (I assume you're probably aware of this) make sure that a novated lease is appropriate for your circumstances. The best way to do this is ask your accountant.
  5. umm OK from my experience only passenger vehicles attract FBT. IE 1 tonners etc do not, I am not sure if bikes fit in the same category. I novate my car and am better off, as the FBT is lower than any other method for me, but speak to your accountant.

    Your employer also has to agree to the novation and my company wont.

    One thing I love about a novated lease is that I include all things in a nice monthly figure, no need to come up with cash on the spot for tyres etc.
  6. We tried it through my wife's work - she can salary sacrifice almost anything. We found if it was possible it would have been a marginal saving but very convenient. Unfortunately her employers wouldn't allow a bike as it was "too difficult"
  7. Ooh, I never thought of this. My work would let me for sure. I just got them to pay for parking (sydney $$) so this would be a snap.

    Link me up please.

    I suppose you need to do at least 20,000 km each year.
  8. The only items where you will be relatively better off by salary sacrificing are:

    1. Motor Vehicles - i.e. passenger vehicles;
    2. Superannuation; and
    3. 1 Notebook Computer per year.

    All other items would be classified as expense fringe benefits and will attract an amount of FBT similar to the amount of the expense being paid for therby nullifying any salary sacrificing advantage.
  9. Depends on your employer - some employees in the welfare and community sector (including hospitals) can salary sacrice anything with no FBT up to a certain amount (I'm not sure of the exact amount - possibly $8,500 or so). That can include rent, travel, entertainment expenses etc.
  10. here is the link
  11. Maybe we should be lobbying for bikes to be included under the FBT rules. Bloody discriminatory that they're not.
  12. When our company allowed novated leases for bikes and this was before it bought us out, we heard that the lads were buying expensive bikes like Harleys, Ducatis and so on, then storing them.

    Apparently, at the time, the FBT was a linear thing, based on kilometres travelled. The more you travelled, the more you paid. But being pre-tax and if you're in the 48 cent bracket (as it was back then), then there were still significant tax savings to be made if you did ride it a lot. $280 tyres costing you $150 nett, that sort of thing.

    So, they'd get their Harley, get it serviced for its first service, then store it. 2 years down the track, bike has very few kays on it. They'd pay out the residual then flog the bike for a signficiant profit.

    Then the company decided to stop leasing bikes. We tried to get it reintroduced as there are quite a few guys here who ride bikes and some who'd consider road bikes (they're the dirty types) if they could get it on a lease. But that fell through. All too hard, accounting section not being co-operative, etc.
  13. The big issue is documenting the expenses for justification.
    depreciation is one of the expenses - so claim on!
  14. 4. mobile phones
    5. PDAs
  15. the guy i bought my pipes off had his bike under novated lease through the government i will see if i can give him a call and ask him on his thoughts afterwards
  16. ...correct

    putting a bike through work is not worth it!

    Our accountants (large firm) have docs from the ATO (tax office to you and me) that states a motorcycle is NOT considered a vehicle under the FBT legislation and any payment ( for anyhting ..lease tyres fuel etc)
    for a bike will be considered an expense payment for which your employer will be slugged the full amount of FBT (unlike cars)
    unless your employer does not hit its employees with FBT relating to things paid for (rare...very rare) a bike is a no-no coz it will cost you
    EXACTLY the same as if you paid for it yourself
    (except if they do..they pay less Super and leave to you..coz your pay is less) :evil:
    which means..you lose and so its not worth it

    discrimatory? against bikers ? yes
    but thats what lil' John and BIG Pete want

    no cheers from me
  17. (skip over point 6)

    7. Tools of trade where applicable. PDAs come under tools of trade.

    I'm renovating a place that we just bought. It's darned handy being able to sal. sac. things like angle grinders, power saws, electric planers, cordless drills, drop saws and the like, I can tell ya.
  18. I have my bike on a novated lease, and am just approaching the end of the first year.

    Obviously not many companies offer this, but where I work the now ex human resources director had a Harley and a Ducati, and he set it up - and we can still do it.

    The FBT rate for bikes is set at a flat 12c per kilometre, it doesnt matter whether you do 2 or 30000 Km's per year. All repayments, fuel, tyres and maintenance costs are included as with an ordinary novated vehicle lease.

    When I originally bought the bike (2006 Yamaha FZ1), I nominated 5,000 Km's per year, which equates to FBT of about $28 per fortnight. My bike, with some accessories, on road costs, insurance etc was $16,000. My fortnightly repayments are $150 over 4 years, with a residual somewhere around $2,000.

    I haven't got the time to work out the exact figures compared to buying using other methods, but my $178 per fortnight - which covers everything related to the bike, and is taken out pre-tax works out pretty well for me. Tax brackets have risen a bit over the last couple of years, so I suppose this might equate to about $120 per fortnight out of my pocket

    I also have a speedo healer fitted (calibrated to -50%) - which works as a kind of 'FBT Eliminator'. This balances things a little in my favor
  19. If you exceed the 5,000km or don't do 5,000km is there any penalty? Or is this figure purely to budget for fuel, servicing, etc.?
  20. Awesome!

    My work only does cars so a no go there for me. They are thinking of introducing salary sacraficed airfares which would be quite handy.