Novated Lease.

[Ford Grunt]

Are you sure that the FBT payable is the $4,950 per annum ?

Our Financial Controller keeps telling me it is the "grossed" up amount that has to be payed. ?

You are right and wrong at the same time

In relation to Orrie question he is talking about FTB (Family Tax Benefit) not FBT (Fringe Benefits Tax) in the sence.

The way the calculation for FTB works is that is GROSSES DOWN your Reportable Fringe Benefit in my example the $9,611 grosses down to $4,950 (ie $9,611 / 1.9417) which you will notice is the taxable value of the fringe benefit.

You are right in that FBT payable is determined by grossing up the taxable value ie. would be $4,950 x 2.1292 = 10,540 giving FBT payable of $5,112 (10,540 x 48.5%).

BUT.. FBT payable and Reportable Fringe Benefits are two different things for starters they often use different gross up rates, ie Reportable Fringe Benefits ALWAYS us the 1.9417 gross up rate, where most fringe benefits (ie those that a GST credit has been claimed on) use the 2.1292 gross up rate for calculation of FBT payable.

Hope this is clear enough

Ford Grunt (Ben).

[Ford Grunt]

With the new Tax rates introduced, it is no where near as attractive as it was, unless you work for a company that has an FBT reduction - It's not an exemption, cause they can only exempt up to $15,000 per year.

<{POST_SNAPBACK}>

This is actually right and wrong as well (sorry mate)

You are right in that salary packaging is not as effective as it was before the new tax breaks but it is a common misconception that people think salary packaging is only for the people paying tax above in the top marginal bracket, this is definately not the case (ie the top marginal rate 48.5% equals the FBT rate of 48.5%).

This principally because there are exempt and concessionally taxed fringe benefits and because an employee can make EMPLOYEE CONTRIBUTIONS toward the benefit to make sure that the taxable value on the benefit is reduced to NIL to ensure it is not taxed therefore at 48.5%.

Im an accountant but im not anywhere near the top marginal rate in fact im below the new $63,000 bracket ie. within the second bracket (see not all accountants are well paid ) and salary packaging is still good for me, even more so that im packaging an exempt benefit.

But packaging can actually be for almost anyone (not the other way around) because if like say for if you are packaging a CAR BENEFIT then the FBT on the car depends on a number of factors as follows:-

1/ the cost of the car

2/ the annual klms travelled by the car (both private and business)

3/ whether that car has a business logbook (the higher the business % the better)

For example say a poor old trainee accountant earning $25,000 PA had an old say Ford Laser worth say $3,000 then FBT on the car would be AT MOST $3,000 x 26% x 2.1292 = $1,660 then assuming the running costs were more that $1,660 per annuam including GST (which isn't hard) and he was going to incur the running costs anyway, than he would be better off packaging so long as he did an EMPLOYEE CONTRIBUTION to net off the taxable value of $1,660.

Some people may think how can you package a car worth $3,000? there are two ways the employer (the accounting firm) could buy the car off the trainee accountant or the trainee accountant could (if he had an associate, which is likely) transfer the vehicle (if it already isn't in the associates name) to an associate and then do an ASSOCIATE LEASE.

Fact is if you are smart, you package every vehicle you can (provided the FBT doesn't exceed the benefit and you have enough salary left) so that all costs are BEFORE TAX rather than AFTER TAX.

Because generally you will incur those costs anyway, as you need to get to work somehow right

While ever there is an income tax system and exempt / concessionally taxed fringe benefits, salary packaging will always be beneficial to some people not withstanding an FBT rebateable or Exempt employers you suggested.

Cheers,

Ford Grunt (Ben)

[Ford Grunt]

Yes Ross the ATO takes my award for the Most Piss Poor Website in existance.

Ha ha I agree. Im an accountant and struggle to find what im looking for half the time due to their sh*te search function.

Hint: If your looking for ATO legislation, tax ruling etc click on the drop down menu to change search bar to: Legal Database (rather than the default All ATO except Legal Database) other you won't find anything

[harvyk]

Yes Ross the ATO takes my award for the Most Piss Poor Website in existance.

Took me ages to find it and I knew what I was looking for....like you say chock full of outdated crap.

But I HAD to keep looking, the though of showing you up was far too strong to resist.

<{POST_SNAPBACK}>

If they made stuff easy to find everyone would be getting out of paying tax...

They make it difficult so that people are always unsure of sh*t and therefore don't risk it... I once saw a post on another forum which said...

Can't tax the rich - they have expensive tax lawyers

Can't tax the poor - they don't earn anything

Good ole middle class - they earn enough to tax, but not enough to afford tax lawyers...

[Ford Grunt]

Can't tax the rich - they have expensive tax lawyers

Can't tax the poor - they don't earn anything

Good ole middle class - they earn enough to tax, but not enough to afford tax lawyers...

Ha ha that's gold.

(spose my solution is try to remedy the fact that im middle case is be a good tax expert).

[SS2XR6T]

I am also interested in a lease for the F6 and have found on the FPV website that states the price in the 'Config and Price' section EXCLUDES LCT and the threshold is as TBO240 said at $57009. So anything above that will be taxed at 25%. So what prices have ppl been able to get the Typhoon down to, drive-away?

[TurboDewd]

Ive heard a lot about it, could someone 'in the know' in this dept pls shed some light on this matter for me pls? cheers.

[Dagabond]

Quick and simple:

Lease is payed pre tax lowering your net income and the amount Johnny takes off you.

(Loosely based for those that'll jump on it.....)

Have a squiz at one of the squilion threads about it....

There's three at the bottom of this thread to start you off.

or here:

http://www.fordxr6turbo.com/forum/index.php?showtopic=17497

[Blonk]

Gives you the opportunity to claim 100% of your vehicle costs but unless you drive at least 40000 + they will get you on FBT...

The fully Novated Phoon cost me about 19k a year all inclusive.

My company would charge me 16k for a Camry.

Dont mind paying the extra 4k pre-tax actually.

[Falchoon]

If the vehicle is used fully for own business (ceramic tiler) is the full lease payment tax deductible? Would a novated lease be the best way to go, rather than say HP or regular bank loan?