Car leases, Hire Purchase and TAX
Oct 5th 2010, 6:10 am
#1
Forum Regular
Thread Starter
Joined: Oct 2007
Posts: 136
Car leases, Hire Purchase and TAX
Hi,
I'm on a 457 visa and i'm looking at either a car lease (private lease, NOT novated as I don't do the miles) or a Commercial Hire Purchase.
Looking at a private lease because I do not care about owning the car and probably 90% of my miles will be business related. I have been lead to believe that this means I can claim back 90% of the tax of my lease costs, fuel, servicing, etc.
CHP is similar but I have been lead to believe I would only be able to claim depreciation of up to the luxury car tax limit ($57k). This works out to be about $5k a year if at this limit.
Now, here's my question. Looking at a car lease it seems the ATO says you can only do the method I mentioned above (with regards to 90% of tax based on private / business miles) if the car is below $57k. If above $57k then you must do the depreciation method. Is that correct?
Does anyone have any experience with this? Any decent calculators?
I'd like to get a $70k car on lease but would like to do the first method around business use calculations. Not sure if what i've found is correct or not!
I'm on a 457 visa and i'm looking at either a car lease (private lease, NOT novated as I don't do the miles) or a Commercial Hire Purchase.
Looking at a private lease because I do not care about owning the car and probably 90% of my miles will be business related. I have been lead to believe that this means I can claim back 90% of the tax of my lease costs, fuel, servicing, etc.
CHP is similar but I have been lead to believe I would only be able to claim depreciation of up to the luxury car tax limit ($57k). This works out to be about $5k a year if at this limit.
Now, here's my question. Looking at a car lease it seems the ATO says you can only do the method I mentioned above (with regards to 90% of tax based on private / business miles) if the car is below $57k. If above $57k then you must do the depreciation method. Is that correct?
Does anyone have any experience with this? Any decent calculators?
I'd like to get a $70k car on lease but would like to do the first method around business use calculations. Not sure if what i've found is correct or not!
Oct 5th 2010, 7:31 am
#2
has lost The Game
Joined: Apr 2005
Location: Chippendale, Sydney
Posts: 8,735
Re: Car leases, Hire Purchase and TAX
Hi,
I'm on a 457 visa and i'm looking at either a car lease (private lease, NOT novated as I don't do the miles) or a Commercial Hire Purchase.
Looking at a private lease because I do not care about owning the car and probably 90% of my miles will be business related. I have been lead to believe that this means I can claim back 90% of the tax of my lease costs, fuel, servicing, etc.
CHP is similar but I have been lead to believe I would only be able to claim depreciation of up to the luxury car tax limit ($57k). This works out to be about $5k a year if at this limit.
Now, here's my question. Looking at a car lease it seems the ATO says you can only do the method I mentioned above (with regards to 90% of tax based on private / business miles) if the car is below $57k. If above $57k then you must do the depreciation method. Is that correct?
Does anyone have any experience with this? Any decent calculators?
I'd like to get a $70k car on lease but would like to do the first method around business use calculations. Not sure if what i've found is correct or not!
I'm on a 457 visa and i'm looking at either a car lease (private lease, NOT novated as I don't do the miles) or a Commercial Hire Purchase.
Looking at a private lease because I do not care about owning the car and probably 90% of my miles will be business related. I have been lead to believe that this means I can claim back 90% of the tax of my lease costs, fuel, servicing, etc.
CHP is similar but I have been lead to believe I would only be able to claim depreciation of up to the luxury car tax limit ($57k). This works out to be about $5k a year if at this limit.
Now, here's my question. Looking at a car lease it seems the ATO says you can only do the method I mentioned above (with regards to 90% of tax based on private / business miles) if the car is below $57k. If above $57k then you must do the depreciation method. Is that correct?
Does anyone have any experience with this? Any decent calculators?
I'd like to get a $70k car on lease but would like to do the first method around business use calculations. Not sure if what i've found is correct or not!
Where have you been looking for your private lease? I haven't been able to find them here - only Novated leases.
S
Oct 5th 2010, 7:46 am
#3
Forum Regular
Thread Starter
Joined: Oct 2007
Posts: 136
Re: Car leases, Hire Purchase and TAX
Hi,
They're all over the place but often the name changes. Private lease / Operating Lease / Personal Lease / Finance lease.
http://www.1300carlease.com.au/operating-lease.html
The principle is the same with all. It's an expensive car hire, you just givew the keys back at the end.
# Operating lease terms range from 24 to 48 months
# No capital outlay is required to fund the purchase of vehicles
# The fixed car lease rentals are on a single monthly invoice allowing easy and accurate budgeting
# Operating lease repayments are fixed for the term
# The car is funded externally and not shown on the balance sheet
# There is a reduction in the time and expense of administration, especially when taken with full maintenance
# Car lease rentals are usually fully tax deductible (except for luxury vehicles)
# There are no costs or liability associated with vehicle disposal
# You control vehicle maintenance and servicing
They're all over the place but often the name changes. Private lease / Operating Lease / Personal Lease / Finance lease.
http://www.1300carlease.com.au/operating-lease.html
The principle is the same with all. It's an expensive car hire, you just givew the keys back at the end.
# Operating lease terms range from 24 to 48 months
# No capital outlay is required to fund the purchase of vehicles
# The fixed car lease rentals are on a single monthly invoice allowing easy and accurate budgeting
# Operating lease repayments are fixed for the term
# The car is funded externally and not shown on the balance sheet
# There is a reduction in the time and expense of administration, especially when taken with full maintenance
# Car lease rentals are usually fully tax deductible (except for luxury vehicles)
# There are no costs or liability associated with vehicle disposal
# You control vehicle maintenance and servicing
Oct 5th 2010, 8:01 am
#4
has lost The Game
Joined: Apr 2005
Location: Chippendale, Sydney
Posts: 8,735
Re: Car leases, Hire Purchase and TAX
Hi,
They're all over the place but often the name changes. Private lease / Operating Lease / Personal Lease / Finance lease.
http://www.1300carlease.com.au/operating-lease.html
The principle is the same with all. It's an expensive car hire, you just givew the keys back at the end.
# Operating lease terms range from 24 to 48 months
# No capital outlay is required to fund the purchase of vehicles
# The fixed car lease rentals are on a single monthly invoice allowing easy and accurate budgeting
# Operating lease repayments are fixed for the term
# The car is funded externally and not shown on the balance sheet
# There is a reduction in the time and expense of administration, especially when taken with full maintenance
# Car lease rentals are usually fully tax deductible (except for luxury vehicles)
# There are no costs or liability associated with vehicle disposal
# You control vehicle maintenance and servicing
They're all over the place but often the name changes. Private lease / Operating Lease / Personal Lease / Finance lease.
http://www.1300carlease.com.au/operating-lease.html
The principle is the same with all. It's an expensive car hire, you just givew the keys back at the end.
# Operating lease terms range from 24 to 48 months
# No capital outlay is required to fund the purchase of vehicles
# The fixed car lease rentals are on a single monthly invoice allowing easy and accurate budgeting
# Operating lease repayments are fixed for the term
# The car is funded externally and not shown on the balance sheet
# There is a reduction in the time and expense of administration, especially when taken with full maintenance
# Car lease rentals are usually fully tax deductible (except for luxury vehicles)
# There are no costs or liability associated with vehicle disposal
# You control vehicle maintenance and servicing
Yes, I had been looking for something like this for a long time - when I bought my car, there were no such things as personal leases etc - It was novated lease or bust. I'm not a business user, which in the past seemed to be a problem, but some of these leasing plans look ok for non-business use.
The ability to negate all of the associated costs with car ownership and be able to just hand the keys back at the end is very attractive...
S
