Vehicle Novation Lease

[XtRmn8]

Dorko,

can you expand on this in alittle more detail please. Not clear to me how you offset FBT with car detailing but it does sound interesting.

thanks

Orrie

You should be able to offset FBT by using he Employee Contribution Method. Make part of the lease payments with post tax dollars.

[DORKO]

You should be able to offset FBT by using he Employee Contribution Method. Make part of the lease payments with post tax dollars.

The best way to offset your FBT is to do the ECM method. Its basically paying your FBT amount monthly. Its after tax deduction/ post deduction of your pay. Mines $370 a month. In other means the other way is you can pay your FBT at the end of the FBT year which is March the 31st. It means you will get a full bill at the end of March, But to offset this amount you declare any contributions you made towards your car between April 1st to March 31st. For example if I spent $500 on getting my ute detail in after tax money I can offset my FBT by $500 as I have already contributed to my FBT same goes if I spent $00 in after tax dollars on Fuel I can then offset my total FBT bill by $900.

I hope this makes sense. Gotta go out to Lunch now.. I will example more when I get back... My Miss's is nagging

Dorko

[Guest]

Most lease companies (if not all) will only allow standard specs unless you buy modded already but then I don't know how you would go on repairs.

Others may have different experiences

[DORKO]

I would image it depends on the company you use to manage your lease ( If at all). I no Easifleet and McMillan Shakespeare dont care about car mods as long as you clear it with your insurance. If its got insurance then they dont seem to worry as much. But none the less always get it cleared before you make adjustments to your car.

Dorko

[luckyboyd]

Just a question for those of you who lease cars. Is there anything in the contracts to say that you can not modify the car in any way? In terms of engine I ma just get a flash tuner box down the track. But I would like to get my own tint done and lower the car after delivery. Seeing that I would own he car and it would be in my name I do not see how this could be a problem.

Most lease companies (if not all) will only allow standard specs unless you buy modded already but then I don't know how you would go on repairs.

Others may have different experiences

Obviously if you only have an edit you can return the car to standard in 2 minutes. If the factory offer tinting, 18" wheels, premium brakes etc, those mods are ok. Another little known loophole is that if your reportable fringe benefits are less than $1000, they are not included on your group certificate.

[tab]

The best way to offset your FBT is to do the ECM method. Its basically paying your FBT amount monthly. Its after tax deduction/ post deduction of your pay. Mines $370 a month. In other means the other way is you can pay your FBT at the end of the FBT year which is March the 31st. It means you will get a full bill at the end of March, But to offset this amount you declare any contributions you made towards your car between April 1st to March 31st. For example if I spent $500 on getting my ute detail in after tax money I can offset my FBT by $500 as I have already contributed to my FBT same goes if I spent $00 in after tax dollars on Fuel I can then offset my total FBT bill by $900.

I hope this makes sense. Gotta go out to Lunch now.. I will example more when I get back... My Miss's is nagging

Dorko

There's an ATO Ruling that exempts you from FBT provided your vehicle is used only for work purposes (which includes traveling between home and work for this ruling) and also for "incidental" trips. All because of the passenger load-carrying capacity of a ute.

Check it out and save yourself some serious $’s

[Dagabond]

Here's somethin for ya tab....Work is trying to tell me that because the Ute is my only form of transport that it doesnt make it exempt from FBT, even if you claim that its only "incidental" trips. I had a quick read and it does sound correct but doesnt worry me as I keep all reciepts, cover the k's needed and pay all extras after tax anyway.

[tab]

Don't they know about the torana in the garage for weekends?

[DORKO]

There's an ATO Ruling that exempts you from FBT provided your vehicle is used only for work purposes (which includes traveling between home and work for this ruling) and also for "incidental" trips. All because of the passenger load-carrying capacity of a ute.

Check it out and save yourself some serious $’s

Yes that is true. however I cant do it because I work in a office... Got nothing to do with my job. This exempt only relates to people that use their car for work. Like a Tradie. You must be careful when claiming for a exempt from FBT. The ATO are when you claim exempts. I won't get out of FBT as my job is punching numbers in a office. The best person for advise in these cases are the Leasing companies. Just make sure you get it in writing!

Dorko

[WCE]

Being a tax accountant myself I've read most the stuff written with interest.

One never ring the ATO once. From experience you get one knowledgeable officer out of 5. They have given incorrect advice to my clients on numerous occassions. So call them more than once to verify the previous crap told.

Two call your bloody accountant they make a living trying to find ways to tweak the rules. Having said that the problem you guys have is that if the employer/leasing mob says they won't go for a certain strategy then, despite the fact you've been told what you want to do is legal, your stuffed.

I liked the bit about paying for detailing, very cool, if paid by the employee gets treated as an employee contribution and reduces the FBT involved, so does any running expense paid by the employee.

I treat most utes/vans as exempt as the personal use is incidental, but it would be hard to justify if the person was a desk jockey.

Edited 09/06/07 02:01 AM by WCE