Running Costs V6

[Hutch Addicted PP Member Find all posts View Profile Close Hutch]

Their is always a lot of chat about novated leases etc, i thought i would share some of my experiences over the past few years.

I always for the last 7 years ran a second vehicle for my wife through a novated lease.

Last year when we brought the prado we decided to lease it ourselves as the lease company wanted $26500k pre tax a year to run and lease our vehicle or probably 16k post tax.

I have tracked every dollar spent on running the car last year, we did about 20000klms with a cost of 16000k including lease costs etc.

so costs are pretty much the same but because we are running the car we can now claim all of my wife's business expenses which is log booked at 70%. So from our point of veiw the novated lease is not alway the best option and we also don't have a lease company telling what i can and can't do to my car. Two years ago i would have never done this but now i have seen the benfits of running your own lease.

My 2 cents.

[whiteman Member Find all posts View Profile Close whiteman]

I have yet to see a novated lease (the type that a lease company funds 100% costs and charges a monthly cover fee to the lessee) beat a self funded lease arrangement. And if you think about it, they never will. The lease company makes a margin on the lease, fuel, maintenance, etc, etc. When you get your own lease you are in a very competitive market space and the finance should come much cheaper. Just a little more work keeping a log book (only needed for 3 months in every five years) and receipts for the tax man. You are in control.

When I got my latest, I was quoted at $1,750/m for a novated lease (our company prefers this). However, I sourced my own lease for less than $1,100/m. That leaves $650/m for fuel and servicing. The same tax benefits apply.