Associate Lease

Associate Lease FAQ

The lease rentals are calculated on a ‘commercial basis’. This means that they are calculated in the same manner as a regular lease, i.e. using a lease term, residual value, car value and a market equivalent interest rate.
We can do all these calculations for you.
Unlike a regular lease arrangement, there is no residual amount payable at the end of the lease period.
The impact and treatment of Fringe Benefits Tax (FBT) on an Associate Lease is the same as a Novated Lease. This is because your employer pays for your Associate Lease and the car’s operating costs from your salary package in lieu of your normal salary or wages.
We will give you all the calculations including the FBT impact when you ask us for an Associate Lease quote.
In addition to the Lease and car running costs, you will be required to account for FBT in your salary sacrifice set up relating to the lease. You can elect to make post tax contributions to your Employer to decrease the FBT taxable value of the vehicle to zero.
We will make the necessary arrangements with your Employer to commence your salary deductions as soon as possible following the commencement of the Lease.
The Associate is responsible for comprehensively insuring the vehicle for an amount not less than the market value of the vehicle.
The Associate must provide your Employer with a Certificate of Currency prior to the commencement of the Lease and when the insurance policy is renewed each year.
The Lease can be terminated with one week’s notice in writing from either the Associate or your Employer.
In the event that you cease employment with your Employer, the Lease will terminate immediately. Should the vehicle not be able to be used due to theft or damage or loss, your Employer will terminate the Lease immediately.
Irrespective of the reason for the termination of the Lease, your Employer is responsible for all Lease payments up to the date of termination.
You are required to advise us should any of the aforementioned events occur.
At the expiry of the initial Lease period, the Lease may be extended for an additional period but is subject to the mutual agreement of the Associate and your Employer. The usual period is up to 3 months however an extension beyond this period would require a new Lease agreement to be executed.
The Associate must have an Australian Business Number (ABN) and should the Associate not already have one, your Employer is not able to commence a lease agreement with the Associate.
Additionally, the Associate is required to have an individual bank account, not a shared account with you.
The Lease rental amount will be subject to GST. The Associate will be required to make a declaration to us on behalf of your Employer regarding the GST status of the Associate.
Your Employer will only be eligible to claim input tax credits on the Lease rental and car running costs if the Associate is registered for GST