Car Owners: Here is Why You Should Run from the Big 4
The Big 4 are the largest 4 banks in Australia. We call them the FAT 4 as they are huge organisations with FAT balance sheets and FAT profits, all earned from lending to their customers ….. YOU.
Here are the reasons why you should run from the FAT 4 and take up a novated lease for your next new or used vehicle.
Lower Monthly Repayments
A secured car loan costs you more in cash flow to repay than a novated lease. Let’s show you an example.
New Mazda 3 G20 Pure Hatchback
Under a 3-year secured car loan the monthly repayment with a FAT 4 bank: $250 establishment fee and fixed interest rate of 8.49% = $828 per month.
The ex- GST monthly lease payment via a novated lease is $533.
The lower repayments through a novated are due to the GST savings and residual value.
Income Tax Savings
When you borrow from the FAT 4 via a secured car loan there is no tax deduction for the repayment of the car and the running costs.
A fully managed novated lease gives you a tax deduction!
The best thing is that you get the tax deduction for NO business use 😊
How much is the tax deduction? Well that dependents on the cost of the car and the running costs.
Using our example of the Mazda 3 G20 Pure Hatch that has a drive away price of $25,990 our estimate of your tax deduction on a three-year lease is $6,814 per YEAR
GST Savings
The tax deductions from your pre-tax salary exclude GST and so you save on GST as well 😊
Bundled Running Costs
You can bundle in most of the running costs of the car and have them deducted out of your weekly, fortnightly or monthly salary.
This avoids “bill shock” of annual registration, insurance, servicing and comprehensive insurance.
Personalised Service
Because we are not one of the FAT 4 we deliver personalised service. From vehicle selection to running cost budgets and selection of the most appropriate term our consultants will guide you.
