Different Leases?

[Mondie]

One other consideration with a novated lease is your marginal tax rate. A novated lease can reduce your taxae income by well over $20K+ a year so if you have other negativley geared investments you can find your marginal tax rate reduced.

[mercturbo]

  Mondie said:

Even better than HP is to take out a seperate loan using equity in your house which will then e at home loan rates. Take it over 30 years, work out what you have to pay over the period you want to keep the car taking into account what the car will be worth come trade in time and you now have HP setup but at home loan rates. because the loan balance wont efflux much over the first 7-8 years of its life you may be able to use the same loan to buy several cars before the amount needs to be increased further.

Hi Simon, just trying to work out how this one works, If you borrow say $50k against your house at say 5% to buy a car, then in the first year you will have the following net losses $2.5k interest, $4k approx running costs, depreciation $10k approx total net loss of $16.5k for the year, your asset is now worth $40k and your loan remains at $50 assuming nothing paid on the principle, you can now get a new car worth only $40k unless you increase your loan to $60k, so you can get another $50k car, am I missing something here? What can be deducted if the car is Buisness use, the whole net loss? If so then assuming a tax rate of 47% you would end up with a net loss of approx $9k for the year. Can you explain this a bit I am interested?

Cheers Rob

P.S. hows the GT sale going, any nibbles?

[Mondie]

The idea is that you pay down the principal Merc. Calculate what residual you want when you sell the car and work backwards on what monthly payment you need to make. lf the car is to be claimed on your tax then you need to run a logbook for 12 weeks and calculate your business use, mine is 75% s this amount of everything is deductible (tyres, servcing, petrol, modifications :lol:, deprecation @ 22%, rego, insurance detailing etc etc) Logbook is good for 5 years unless your circumstances change.

Had one nibile on the GT -but no hurry, l'll be happy if l dont sell it until late this year. Certainly dont want to sell it before the end of the financial year.