Can I adjust the Novated Lease amount that RemServ requests from my pay?
Let’s take a look at this question in detail, to do so it helps to look at your novated lease contribution in two parts.
The first part are the items like your novated lease payment and administration fee, which are non-negotiable amounts. This part of your contribution cannot be changed and will remain a regular amount throughout the term of your novated lease.
The second part is made up of items like your registration, insurance, tyres, fuel and other running costs. This part of your contribution is more flexible; technically you don’t have to contribute funds to these items at all, you would just pay for them yourself (like you would without a novated lease) — but if you paid for them yourself, you would not be using before-tax money to do so and would miss out on any potential tax savings.
Example – You enter a raffle and you win a new set of car tyres! At this point you would probably stop putting money aside for tyres with RemServ for the next year, because you would no longer need to buy tyres. You would of course start your tyre budget up again once it was necessary.
When you contribute money to RemServ, a portion of the money is contributed from your before-tax pay and you are taxed on the remaining — lower — amount. The more we request from your pay, the smaller the amount you could be taxed on!
RemServ set up these annual budgets and estimates so you can not only enjoy the convenience of having your running costs budgeted for, you also access the best possible potential tax savings as well.
Where does the money go?
Each pay your contribution is added to your RemServ novated lease account — think of it like a bank account for your lease.
RemServ makes your regular lease payments from this account, reimburse you from this amount when you claim and pay those annual expenses — like registration — from here when needed.
Disclaimer: This website contains general information and doesn't take your personal circumstances into account. Seek professional independent advice before making a decision.