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Novated Lease

A convenient and cost-effective way to drive a vehicle of your choice.





What is a Novated Lease?

A Novated Lease is a three-way arrangement between an employee, their employer and Alphabet. It allows you, as employee, to use a combination of your pre and post-tax salary to pay for a vehicle of your choice - with the added flexibility of choosing a vehicle that’s right for your budget and lifestyle.

How does a Novated Lease work?


1. Select your vehicle

Choose a vehicle that suits your individual requirements.

2. Get a quote

We will prepare a personal quote for you, based on your preferred vehicle, expected kilometres and term of lease.

3. Contract

You, your Employer and Alphabet enter into a Novation Agreement.

4. Simple payment

Your employer will deduct regular payments out of your salary, and remit these to Alphabet.

5. Cash-free motoring

Your lease payments include your vehicle running costs.

6. End of Lease

At the end of the lease term, you will have the option to extend your current arrangement (refinance), purchase your vehicle or return it to us. Subject to credit approval.

Benefits to Employee
  • Attractive interest rates
  • Discounted vehicle pricing through our national preferred dealer network
  • Discounted fuel and vehicle servicing costs
  • Maximise your salary by reducing the amount of income tax you pay Subject to your personal circumstances. Individual circumstances may vary.
  • We can modify your lease if your personal circumstance change. Subject to credit approval.
  • Choose the right vehicle for you and then choose the terms and kilometres that suit your travel and budget requirements.
Service & Convenience
  • One set payment deducted from your salary, allowing you to enjoy the convenience of cash-free motoring.
Peace of Mind
  • A team of novated leasing experts will guide you through the entire process, with full transparency on all applicable fees and interest rates.
Benefits to Employer
Simple Payroll
  • One monthly invoice
  • We handle the lease management and reconciliation
  • Online Novated portal
Minimise Risk
  • The vehicle stays with the employee if their employment is ended
  • No end of lease or fair wear and tear liability
  • FBT reporting
    Dedicated team of Novated Leasing specialists
    • Personal Relationship Manager for all reporting and communication requirements
    • Guidance and education for staff
    • Industry and product expertise
    Transparent & Competitive Offering
    • Disclosure of applicable fees & interest rates
    • Our interest rates are competitive in the market
    • Our quotes are simple to understand
    Attract and retain the right people for your business
    • A Novated lease can support an attractive remuneration package offering
    • Provide your staff with flexibility of vehicle choice
    Additional Information
    Lease Terms

    We provide lease terms ranging from 12 to 60 months.

    Change of Employment

    In the event that you leave your current employer please contact us immediately so that we can review your options with you;

    1. Re-novate your vehicle with new Employer

    In this scenario you can maintain all existing lease service and simply transfer your lease to your new employer

    Your new employer will need to sign the Novation Agreement with Alphabet Australia in this instance.

    1. Your new employer does not want to enter into a novation agreement with us or you do not have a new place of employment.

    In this instance, all existing lease services cease must and the finance payment obligations transfer from your employer to you.

    These lease payments are paid from your after-tax income.

    Alternatively, you may terminate your lease early.


    It is mandatory that your vehicle is comprehensively insured at all times throughout the lease period with Alphabet Australia noted as the financier.

    Alphabet Australia offer a comprehensive insurance product for you to utilise, alternatively you can use an insurer of your choice.

    Vehicle Choice

    Our Novated Lease consultants work with you to help determine the most suitable vehicle for you.

    For FBT purposes, ATO guidelines stipulate that a car is designed to carry less than one tonne and fewer than nine passengers.

    Alphabet will finance new and second hand vehicles, vehicles must be no older 8 years at the end of the lease period.

    Residual Values

    At the conclusion of your lease you have a residual amount owing.

    ATO Guidelines, as of October 2017, dictate the minimal residual that can be set for your lease as outlined below.

    Term of Lease

    Residual Percentage

    1 Year


    2 Years


    3 Years


    4 Years


    5 Years



    In the instance that you terminate your lease or purchase your vehicle at lease end, the payment amount value attracts GST.

    Luxury Car Tax (LCT)

    Luxury car tax is a tax applied to vehicles with a GST inclusive value above the LCT threshold.

    The applicable LCT amount is calculated by the dealer and included in the purchase price of the vehicle.

    Luxury Vehicle Adjustment (LVA)

    In the scenario that the amount financed within a Novated Lease is greater than the Luxury Vehicle Limit (as set out by the ATO), then your employer has to account for the vehicle differently, resulting in additional tax accounting costs for you and your employer.

    When the vehicle is deemed a luxury car, your employer needs to account for your vehicle as a ‘loan’ rather than a ‘lease’, meaning your employer can only claim interest on depreciation up to the luxury car limit. Any depreciation above the luxury car limit isn’t deductible, resulting in lost tax credits to your employer.

    In the instance where LVA applies, we manage these requirements for you, incorporating any additional costs into your lease as a budgeted amount.

    Reconciliation of Lease

    At the conclusion of your lease we complete a full reconciliation of your budgeted expenses.

    A summary is then provided to both you and your employer and any remaining payments or refunds are finalised promptly to enable the final tax adjustments to be completed.

    Early Termination

    If you wish to terminate your Novated Lease prior to the contract lease period, please contact us to receive a lease payout quote.

    If you wish to early terminate your current lease and upgrade your vehicle there will be no penalty interest applied.

    Telephone: 1800 220 580


    An Alphabet Novated Lease Package can provide you with an after tax benefit. The amount of this benefit is largely determined by your personal financial circumstances, vehicle choice and usage. All this information contained on this page is intended for informational purposes only and Alphabet makes no representation as to its accuracy, completeness, suitability or validity. It should not be considered as financial, taxation or legal advice. We recommend you seek independent professional financial advice regarding the effectiveness of Salary Packaging a vehicle.

    Alphera Insurance:

    This insurance is issued by Allianz Australia Insurance Limited, 
    AFS Licence No. 234708 ABN 15 000 122 850 (Allianz). In arranging 
    this insurance Alphera Financial Services, a division of BMW Australia 
    Finance Limited ABN 78 007 101 715 and authorised dealers act as 
    agents of Allianz and not as your agent.


    Alphabet Insurance:

    Alphabet Motor Australia Insurance is underwritten by Allianz Australia Insurance Limited AFS Licence No. 234 708 ABN 15 000 122 850 (Allianz). In arranging this insurance Alphabet Australia, a division of BMW Australia Finance Ltd ABN 78 007 101 715 (Alphabet Australia) and its authorised dealers act as agents of Allianz and not as your agent. In entering into a contract of insurance for this policy, you acknowledge that this Product Disclosure Statement (PDS), your Schedule and any other document which we tell you forms part of this policy (Policy Documentation), sets out the entire agreement that exists between you and Allianz in connection with this policy. You also acknowledge that you have not relied on any prior representations which are not expressly included in or are otherwise inconsistent with the Policy Documentation. Neither Alphabet Australia nor any of its related companies have any liability in respect of this policy.