Compare car leasing solutions and find out the best option for you through Savvy.
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If you’re a business or employee looking for a vehicle, a car lease can offer a flexible and cost-effective way to access one. This type of finance allows you to use a vehicle or equipment for a set period of time without having to purchase it.
If you are looking for a car lease, you can compare a range of car lease offerings from a number of commercial lenders. Our experienced consultants can help secure the best rates and terms for your circumstances and get you approved in no time. Get started with a quote from Savvy today.
A car lease is a finance product that allows businesses and individuals to use a car without owning it. Instead, the financier buys the vehicle and then leases it to you for a set term. There are three main types of car leases in Australia:
An operating lease is essentially a long-term rental agreement taken out by a business for assets such as vehicles or equipment. At the end of the term, the business returns the asset – unlike other lease types, there is not option to buy. This type of lease is a suitable option when temporary access is needed and ownership isn't the primary goal.
A finance lease, also known as a capital lease, is a type of lease agreement where the business leases the asset from the financier over an agreed term with an eye to purchasing it. At the end of the lease, the business pays a balloon or residual payment to secure the asset. These leases are typically cheaper than operating leases as payments only include lease costs not maintenance and running costs.
A novated lease is a car financing option for employees that allows them to salary package a car through their employer. Lease payments are deducted from the employee’s pre-tax salary, potentially lowering their overall tax bill. The leased car is the employee’s to use for personal and work purposes during the lease term, and at the end there is the option to pay the residual and own the car outright.
Here’s how the different options compare:
| Operating lease | Finance lease | Novated lease | |
|---|---|---|---|
|
Ownership |
Lessor retains ownership throughout lease term |
Lessor retains ownership until end of term |
Lessor owns vehicle, employer facilitates lease, employee has possession |
|
Option to buy |
No option to buy at end of lease term |
Option to buy at end of lease term |
Option to buy at end of lease term |
|
Term length |
1–5 years |
1–5 years |
1–5 years |
|
Maintenance |
Typically included in lease agreement |
Lessee responsible for maintenance costs |
Responsibility varies, often included in lease agreement |
|
Payment |
Fixed payments covering lease period |
Fixed payments covering lease period |
Payments deducted from pre-tax income |
|
Mileage limits |
Yes, many leases set a maximum number of kilometres per year |
Yes, many leases set a maximum number of kilometres per year |
No |
|
Balloon payment (residual value) |
No |
Yes, if lessee chooses to buy car |
Yes, if employee chooses to buy car |
A fully maintained car lease can offer a convenient, low-admin way to get use of a vehicle without the hassle of arranging maintenance, insurance and registration. Much like shorter-term car hire, certain running costs like are all taken care of within your regular fixed payments. This option may be available to you on operating leases and novated leases, but not finance leases, which require you to organise and pay all maintenance and other on-road costs yourself.
Here’s how a fully maintained car lease compares to non-maintained car lease:
| Fully maintained car lease | Non-maintained car lease |
|---|---|
|
Maintenance included in monthly payment and arranged by the lessor |
Arrange your own servicing on your own schedule, around recommended intervals |
|
Costs are tax deductible |
Costs are tax deductible |
|
Rego included in monthly payments |
Register the vehicle yourself
|
|
Insurance included in monthly payments |
Source your own insurance |
|
Breakdown assistance included |
Opt for breakdown cover or choose to pay as you go
|
Companies with larger fleets often choose fully maintained leases because it reduces the amount of administration work. However, while fully maintained vehicle leasing is easier to budget for, it is typically more expensive and removes some of the freedom from sourcing servicing and insurance.
When you're deciding whether to lease or buy a vehicle, it's essential to consider the tax implications. In Australia, you can claim tax deductions for car expenses if you lease the vehicle under an operating lease agreement and use the car for work purposes. Expenses that can be claimed include repairs and servicing, fuel, insurance premiums, registration and depreciation. You may also be eligible to claim goods and services tax (GST) credits if you are registered for GST.
If you have taken out a finance lease and are registered for GST, you can claim back some or all of the GST included in your lease payments as an input credit on your next Business Activity Statement (BAS). This means you can effectively reduce your GST liabilities, saving you more money. Other tax deductions may be available, depending on your circumstances.
If you get your car under a novated lease or as part of a salary packaging agreements, you cannot claim tax deductions for running costs. However, you can typically claim for additional expenses associated with using the car for work, such as parking. Furthermore, under a novated lease, the running costs of your vehicle are deducted from your pre-tax salary, allowing you to save on your income tax.
Much like a car loan, how much you pay to lease a car varies and is dependent on a number of factors, including:
Whether you are looking for a car lease for business or personal use, it’s important to understand the costs involved and budget appropriately. With Savvy’s car lease calculator you can estimate how much you will pay each month and over the course of the loan.
Whether you are a business owner or an employee, there are a number of ways to get a car for work. Other than car leases, you may want to consider:
We make the entire process quick and easy with quoting, approval and settlements all occurring online.
Your personal consultant will guide you through the process, answering all your questions along the way.
Before you begin, it is important to determine if a car lease is the best option for your circumstances. If you are a business, discuss your options with your accountant before making a decision.
Comparing quotes with Savvy is easy. As one of Australia’s trusted commercial brokers, we can compare lenders in moments and tailor our search to your requirements. We will then present you the best offers available for you to decide.
Once you have decided on a quote, it's time to submit your details. The Savvy application process is quick, available on all devices and entirely online. A submission takes approximately 10 minutes and you will have a formal offer within a day.
Once approval has been finalised, it's time to find a car, if you haven't already. If you need assistance, our in-house car broking team can help you find a new or used car from its national dealer network.
Once you've settled on a car, it’s time to sign off on your documents. This process is completed all online through e-signing. Settlement will generally take place on the same day that you finalise your documents.
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Quantum Savvy Pty Ltd (ABN 78 660 493 194) trades as Savvy and operates as an Authorised Credit Representative 541339 of Australian Credit Licence 414426 (AFAS Group Pty Ltd, ABN 12 134 138 686). We are one of Australia’s leading financial comparison sites and have been helping Australians make savvy decisions when it comes to their money for over a decade.
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For more information about us and how we conduct our business, you can read our privacy policy and terms of use.
© Copyright 2024 Quantum Savvy Pty Ltd T/as Savvy. All Rights Reserved.
© Copyright 2024 Quantum Savvy Pty Ltd T/as Savvy. All Rights Reserved.
Quantum Savvy Pty Ltd (ABN 78 660 493 194) trades as Savvy and operates as an Authorised Credit Representative 541339 of Australian Credit Licence 414426 (AFAS Group Pty Ltd, ABN 12 134 138 686). We are one of Australia’s leading financial comparison sites and have been helping Australians make savvy decisions when it comes to their money for over a decade.
We’re partnered with lenders, insurers and other financial institutions who compensate us for business initiated through our website. We earn a commission each time a customer chooses or buys a product advertised on our site, which you can find out more about here, as well as in our credit guide for asset finance. It’s also crucial to read the terms and conditions, Product Disclosure Statement (PDS) or credit guide of our partners before signing up for your chosen product. However, the compensation we receive doesn’t impact the content written and published on our website, as our writing team exercises full editorial independence.
For more information about us and how we conduct our business, you can read our privacy policy and terms of use.
