Step by Step guide

If you’re looking to make the most of a salary package, a Novated Lease through Volkswagen Financial Services can put the car of your dreams in your driveway for less.

How does a Novated Lease work?

Taking out a fully maintained Novated Lease with Volkswagen Financial Services is an agreement between you, us and your employer.

When you lease a vehicle from us, we invoice your employer for the lease payments, which also cover the vehicle’s running costs. Your employer then pays these costs from your pre-tax salary for an agreed length of time.

Your vehicle in 4 easy steps

Step 1: Choose a vehicle

Once you tell us the kind of vehicle you’re after, we’ll source one that’s perfect for you. And remember, it doesn’t have to be a Volkswagen, ŠKODA or Audi vehicle – the make and model is up to you! We will also work out a budget for your vehicle's running costs.


Step 2: Choose a finance product

You can choose either a Novated Finance Lease or a Novated Operating Lease.

With a standard Novated Finance Lease, at the end of the lease period you can return the vehicle and upgrade to a new model, or refinance to pay off the residual amount over time. In either case, you ultimately own the vehicle.

With a Novated Operating Lease, you simply return the vehicle to us at the end of the lease period and, provided it meets your agreed kilometre limit and fair wear and tear guide, you can walk away risk-free, as we take on the risk for the vehicle’s residual value. And if you want to upgrade to the latest model, we can then arrange a new lease on another vehicle.


Step 3: Choose your services

You can opt for as many services as you like, and the types of insurance you need to give you total peace of mind. And because these costs come out of your single monthly lease payments, you get to enjoy all the perks without any of the hassles.  Plus, with our extensive networks and buying power, you will benefit from high-quality service and repairs at lower costs.


Step 4: Let us take care of the rest!

Your employer will automatically make monthly lease payments from your pre-tax salary, which includes all the options you chosen, such as insurance, maintenance or FBT charges. So you can enjoy your car, worry free!

Top FAQs

What is a Novated Lease?
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Novated Leases are an agreement between the employer, the employee and the financier of the vehicle. The employer pays the repayments on behalf of the employee. The employer then pays the costs from the employee's pre-tax salary for the duration of the loan or their length of employment. This could give the employee tax benefits compared to other types of vehicle finance.

What is the difference between a Novated Finance Lease and a Novated Operating Lease?
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The key difference between a Novated Finance Lease and Novated Operating Lease is that Volkswagen Financial Services carries the residual value risk in cases of an operating lease.

This is not the case for a Novated Finance Lease where you will have to pay any shortfalls at the end of the term. Also with a Novated Operating Lease your repayment can also include the vehicle's running costs and Maintenance.

ECM stands for ‘Employee Contribution Method’. This means that you pay your vehicle costs in full or part from your after-tax salary, which can reduce the FBT due on your salary packaged vehicle.

FBT, or fringe benefits tax, is a Commonwealth government tax on any employee benefits that aren’t part of your salary, such as a work vehicle. FBT is calculated each year from 1 April to 31 March. Employers pay the FBT then generally charge it back to the employee as an extra pre-tax payment.

What happens if I leave my job?
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If you leave your workplace before the lease has expired, you’ll be personally responsible for making the remaining lease payments, or you will need to make a new agreement with your new employer.

What kind of car can I have under a Novated Lease?
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Volkswagen Financial Services is happy to help you with a Novated Lease on any make or model of car. It doesn't even need to be a Volkswagen Group brand vehicle!

One of the great things about Novated Leases is that there are only a few restrictions around the types of vehicles. Your employer might have some rules of their own about the type of vehicle you can have, so it's best to check your company policy too.

Benefits for the Employee

Hassel-free driving

Since Volkswagen Financial Services takes care of all the servicing, administration and day-to-day responsibilities of keeping the vehicle on the road, this means less work for you.

Get more from your money

Your lease payments come out of your pre-tax salary, so those payments could potentially reduce your taxable income. In this case you may end up paying less tax, as well as enjoying the convenience and comfort of a brand new car.

Business rates

With a Novated Lease from Volkswagen Financial Services, you’ll also be able to get the same competitive rates available to businesses, giving you a better deal than if you bought or leased the car another way.

Benefits for the Employer

No GST hassles

We claim the GST when we buy the vehicle, so it won’t be charged to you or your employees as part of the lease. We also claim the GST on operating costs such as tyres, servicing and fuel.

Attract and keep talented people

With Novated Leasing options on offer, you’ll differentiate yourself from your competitors when it comes to hiring the best employees and keeping them happy.

Offer your staff more flexibility

You can even give your employees the option to lease more than one vehicle, giving them ultimate flexibility.

Speak to a fleet specialist

We’ll listen to you to find out what you need, then find a vehicle solution that fits your business and budget — no matter how large or small.