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Novated Leases A novated lease is a three way arrangement between you (the employee), Leasecorp and your employer, whereby a vehicle is leased from the financier under a finance lease in your name, and novated (assigned) to your employer, by way of a novation agreement. The employer then pays the cost of this lease. In addition they may pay all running costs associated with the running of the car. The total of all these costs is deducted from your gross salary, thus reducing your tax. In most cases, it will be both cost and tax effective to own a motor vehicle as part of a remuneration package, due to the concessional taxation treatment of motor vehicles under the Fringe Benefits Tax legislation. Advantages to the employee are:
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