Work Car

[big_harold]

Yay - I finally quit my offshore job and will shortly become an office monkey!
60% paycut but home everynite - FTW.

Now - I've searched and seen the other threads on novated leases and I'm not a big fan.

So prior to visiting my accountant I pose the question to ya'll;

if you have $11K pa car allowance.
Plus have the cash to buy a $30Kish car outright

Would you buy outright, get a loan or lease ?

b_h

[THE GODFATHER]

Depends on what you want to do with the car.
Are you in sales?
Are you inmanagement.
Do you need to carry shit around?
Do you need to cary clients (yes, could be the same as the above line)?

[Aphex]

HP/Lease FTW. Tax advantages etc.

[mikey_R6]

only if you do enough kilometres though... i think

[Taz]

it also depends if you want to keep said car if you move on from this company. but outright paying you still get tax deduction just dont have to worry about interest

[big_harold]

Yeah - management.
So just get from home to work.
Occasional client meets.

[Aphex]

On outright purchase you cant claim the principal. Only depreciation.

With HP you can claim the interest as calculated propotionately to your business use or statutory methods depending on your business use.

EDIT: Just saw your last post.

To & from work is classed as private use unless you go from home to a client to the office or vice verca on the way home.

[Jonchilds]

If you go the non-lease route, you could buy the car outright and claim depreciation, and then take out a ~$30k personal loan @ 10-12% to invest in something giving slightly better returns. Interest is tax deductible AFAIK. Still got the $30k effectively, and you get the full amount of interest as a deduction, along with car expenses.

Returns should be positive otherwise you're just burning money.

Might be something to bounce off your accountant.

[jules_1972]

Go back offshore and get 60% back.......

[big_harold]

Hell no baby,
I just had 12 years of that shit.
I gave up over $100K pa to get a slice of normality back.
Don't think the money comes without cost.

[kwakas]

what aphex said.

if you can salary sacrifice that may even be the way to go. woot! tax free car ftw!

[taDere]

autopia.com.au is one place to check out !!

[Morgs]

Did you know that you can now salary sacrifice a bike, and the FBT is 12c per kilometre. Not all companies do it, but it is possible. Can be very advantageous if you are in a higher tax bracket, especially if you don't do a high mileage.

[kwakas]

Did you know that you can now salary sacrifice a bike, and the FBT is 12c per kilometre. Not all companies do it, but it is possible. Can be very advantageous if you are in a higher tax bracket, especially if you don't do a high mileage.

you can actually salary sacrifice anything, like cars, bikes, laptops, work clothes etc.

[Aphex]

Pssst.. kwakas... Morgs does salary packaging for a living