Motor Vehicles

The University offers Novated Leases only with Custom Fleet under the salary packaging arrangement. Custom Fleet was selected as the preferred provider after an assessment of what was available in the market place. The University does not give any undertaking that this is the best available deal for motor vehicle leasing.

A Novated Lease is a simple three-way agreement between the employee, the employer and Custom Fleet in which:

1. The employee leases the vehicle directly from Custom Fleet.
2. The employee and employer along with Custom Fleet sign a Novation Agreement.
3. The employer undertakes to cover all agreed vehicle expenses under the salary package during the employee's term of employment.

The total cost of the vehicle is allocated against the employee's salary package.

Motor vehicle leasing will attract fringe benefits tax and this amount is calculated as part of the salary package deduction. If the taxable value of the fringe benefits you receive in an FBT year (1 April to 31 March) exceeds $1000, the grossed-up taxable value of those benefits will be recorded on your payment summary (formerly group certificate) for the corresponding income year (1 July to 30 June).

Staff are urged to seek external financial advice before entering into a Motor Vehicle Novated Lease Agreement.

Conditions

• All staff are eligible to take a Motor Vehicle Novated Lease provided the general condition of packaging no more than 40% of fortnightly superannuable salary is met and the contract of appointment is of a longer duration than the motor vehicle lease period which is usually 3-4 years.
• Novated Leases are available only through the University's preferred provider, Custom Fleet and all negotiations regarding a lease agreement must be conducted with them.
• Staff must sign a Lease Agreement with Custom Fleet and a Novation Agreement with the University of Adelaide and Custom Fleet and comply with the terms of the Agreement.
• All vehicles will be owned by the leasing provider, Custom Fleet.
• Only one vehicle can be packaged at any one time.
• Staff taking leave without pay during the term of the lease are responsibility for continuing lease payments from their own private resources.
• Human Resources must be notified of any changes to salary packaging
• University of Adelaide will not be held the liable for any loss associated with salary packaging.
• Salary packaging may not be retrospective and staff are obliged to give a minimum of four weeks' notice for packaging arrangements to be processed/amended.
• On termination of employment during the lease period, the Novation Agreement between the University of Adelaide and Custom Fleet ceases. The staff member must contact Custom Fleet regarding the leased vehicle as soon as possible before termination becomes effective. Any outstanding amounts after termination must be paid by the staff member directly to Custom Fleet.
• Staff should be aware that once a Lease Agreement has been entered into, terminating the Agreement before the end of the lease period is likely to incur a considerable cost to the staff member.
• Fringe Benefits Tax is a liability to the University and is deducted from the employee's salary in addition to the lease payment.
• Staff are responsible for any damage to the lease vehicle, speeding or other traffic fines which may be incurred during the lease period.
• The University will seek to recover from an employee or former employee any loss or damage caused to it as a result of any breach during the period of employment with regard to a Novated Lease.
• At the end of the lease period staff members must deal direct with Custom Fleet for finalising any outstanding payments, for example, residual values or other adjustments depending on the type of novated lease they have, or to negotiate a new lease.

Administration Costs

• The administration cost of $260 per annum ($10 per pay) inclusive of any government taxes will be charged for motor vehicle novated leases to defray the costs of administration, reconciliation and FBT/GST accounting. This will be processed as a pre-tax deduction from salary each fortnight.
• A 'change to deduction' administration charge of $130 will be made for staff-initiated changes during a motor vehicle lease term. Any other out-of-pocket expenses incurred by the University with regard to changes to packaging arrangements during a package term will be passed on to the employee.
• Administration cost charges are cumulative.

How do I apply to enter into a salary packaging arrangement for a motor vehicle?

1. Read the 'General Conditions' and the conditions above.
2. Visit the Custom Fleet website to see the services that are offered. If you are unable to find out the information you are looking for, contact Custom Fleet on 1800 811 922 and ask for Sam Cincotta. Sam can also be contacted directly on (02) 8899 5444. You may wish to download the Custom Fleet Driver online document to assist in navigating the Custom Fleet website.
3. Contact Custom Fleet on 1800 811 922 to obtain a quote for a leased motor vehicle or use the online system on the Custom Fleet website.
4. Consult your financial advisor.
5. If you decide to proceed with the leasing arrangement, ensure the salary package total value is not greater than 40% of superannuable gross salary (including FBT and administration costs).
6. Accept the quote with Custom Fleet and finalise negotiations.
7. Complete and sign Lease Agreement and Guarantee (including The Schedule) and Novation Agreement documents and make arrangements to see the Manager Employee Services, Human Resources, for signing of the Novation Agreement
8. Return signed Agreements to Custom Fleet for vehicle order.
9. Take delivery of the vehicle from Custom Fleet.
10. Complete payroll deduction authorisation, attach a copy of The Schedule and send to Payroll Services, Human Resources.

Forms

• Motor Vehicle Novated Lease Salary Deduction Authority Form