Changes to FBT in May Budget?

[AndrewW]

I was reading the following article this morning:

http://www.news.com.au/business/story/0,27753,24836443-462,00.html



Among the likely casualties in the May Budget is the fringe benefits tax on salary packaged motor vehicles, which costs taxpayers around $1.5 billion a year.

The Courier-Mail has learned the Government is targeting the scheme, with senior ministers aiming for savings of at least $300 million a year.

This will drive up the tax bill for thousands of employees who drive company motor vehicles and take advantage of lucrative "salary sacrifice" deals.

The FBT arrangements allow employees to cut their tax bill by thousands of dollars a year - provided they drive a certain number of kilometres.

"It's a costly rort which should go," said one minister.

The Government is expected to adjust the FBT tax rates. For instance, the current rate is 26 per cent if an employee drives up to 14,999km a year - but this is slashed to 7 per cent if the vehicle is driven more than 40,001km.

Any changes to the FBT scheme will be strongly opposed by the car industry, which receives billions of dollars in government assistance to stave off plant closures.


This sounds to me like they are talking about a flat rate of FBT (and at the highest rate, not the lowest).

I have two cars running on Salary Sacrifice, if they were to do this then I would have to get rid of them both.

I just don't get how they can even suggest this. On the one hand they are trying to prop up the Aussie car manufacturers with cash handouts, and then on the other they are proposing changes to the FBT rules that would see the second hand market flooded with people trying to offload their vehicles as they try and get out of salary sacrifice arrangements, and would also put a massive dent in new car sales (I currently replace each of my cars every 2 years, but there's no way I'd be doing that without the salary sacrifice arrangements).

The last paragraph is the only one that gives me hope. Surely the car manufacturers and dealers will kick up a massive stink and get this killed of quickly, right?

Thoughts?

also, love the quote from Minister about it being a "costly rort". Quite funny coming from the guy being driven around in a tax payer funded car.

[HHVYSS]

yes this is a worry. I must admit I thought something nasty was going to happen in the last budget. The question will be whether they introduce any change prospectively. To change the law retropectively would be totally unjust.

[the big fist]

It's probably part of krudds "razor gang" out trying to find where they can get more tax dollars from.

[AndrewW]

The question will be whether they introduce any change prospectively. To change the law retropectively would be totally unjust.

We were having this discussion in the office this morning.

So there are two options:

A. Introduce flat rate of 26% immediately, and retrospectively.
My costs go up $13903 per year across my two vehicles
End result: The second hand market is flooded and I lose a LOT of money
End result2: People stop buying new cars

B. Introduce flat rate of 26% for new ss arrangements, grandfather old rates for existing ones.
End result: I never upgrade my cars, keep these ones going until they fall apart.
End result2: People still stop buying new cars


It's probably part of krudds "razor gang" out trying to find where they can get more tax dollars from.

this is exactly what it is.

It is ridiculous to be handing out billions to prop up the local car industry, and the talking about introducing changes like this that will have an even larger negative impact.

funnily enough, I'm not hearing any talk about cutting back on MPs perks like free travel, or their ridiculous superannuation arrangements.

[mac06]

The increase in LCT affected sales of luxury cars and now the government makes less money than before in that area. If rates for FBT also change and people stop buying as many new cars, then once again less money for the government. It's not rocket science. I wonder if the people who do the sums for the government are the same ones that came up with the idea of changing the LCT rate? If so, maybe they should get new advisors.

[tim_k]

This is your "Christian Socialist" government hard at work. Give cash and more cash to the poor and fragile businesses in our society whilst punishing the middle class with more taxes and charges:flipoff:

[BLAQSSHEV]

I was reading the following article this morning:

http://www.news.com.au/business/story/0,27753,24836443-462,00.html



This sounds to me like they are talking about a flat rate of FBT (and at the highest rate, not the lowest).

I have two cars running on Salary Sacrifice, if they were to do this then I would have to get rid of them both.

I just don't get how they can even suggest this. On the one hand they are trying to prop up the Aussie car manufacturers with cash handouts, and then on the other they are proposing changes to the FBT rules that would see the second hand market flooded with people trying to offload their vehicles as they try and get out of salary sacrifice arrangements, and would also put a massive dent in new car sales (I currently replace each of my cars every 2 years, but there's no way I'd be doing that without the salary sacrifice arrangements).

The last paragraph is the only one that gives me hope. Surely the car manufacturers and dealers will kick up a massive stink and get this killed of quickly, right?

Thoughts?

also, love the quote from Minister about it being a "costly rort". Quite funny coming from the guy being driven around in a tax payer funded car.

Thoughts??

Um THIS SUCKS BIG TIME

This year is the first time I have got a salary sacrificed vehicle i have felt like I am kind of winning or not getting quote "rorted" I hope this gets qaushed bigtime, hopefully they will do some simple mathematics and realise that it is a mistake.

[the big fist]

I don't really think that the change in the FBT affects the local car industry at all. Really it is just dictating that you purchase a car that is more in your financial bracket, in other words buy an astra instead of commodore, something along those lines. At the end of the day they know that we all need cars so it is only going to affect a pretty small few who have multiple cars due to the tax break.

[AndrewW]

Thoughts??
This year is the first time I have got a salary sacrificed vehicle i have felt like I am kind of winning or not getting quote "rorted" I hope this gets qaushed bigtime, hopefully they will do some simple mathematics and realise that it is a mistake.

You're not kidding.

Here I am looking at the amazing prices being offered on 2008 Clubsport R8s, and I'd be on them in an instant if it wasn't for this proposed to change to FBT :flipoff:


I don't really think that the change in the FBT affects the local car industry at all.

I know a lot of people who change their cars every two years, because the salary sacrifice rules make it affordable.

If they make the proposed changes, then there will be many people who can't afford to keep their salary sacrificed cars, and that surely can't be a positive thing for the local car industry.

[hallyoz]

I think you need to separate thoughts about MP entitlements and Salary Sacrificing of motor cars. Lets be honest, MP have quite a low base salary for the responsibility thye have, so perks make up for it. One of the reasons why we have ordinary politicians perhaps???? Not enough incentive for people with some talent to go into that type of job.

Re salary sacrificing, for the majority of people it is a bit of a rort available to a limited amount of people. Most white collar/professionals can take advantage of it, whereas blue collar workers usually cannot. Most people who salary sacrifice a car use it for personal use only, not for work use (and driving to and from the office is not work use - hence public transport costs not being tax deductible for everyday work commuting etc). So is it fair? Depending on what side you are on will generally determine the answer.

Whilst I agree the novated lease has helped sell a lot of cars over the past few years, has it really help the local industry? Personally I don't think so, it has only helped the importers. The local industry was proped up by companies purchasing Commodores, Falcons and Camrys for their employees for a long time. Maybe with the mooted changes this might help again. The other side the coin is that 'choice' may be taken away.

I lease my car, burt this time have decided to use a post tax or hire purchase lease. it works better for me in terms of child support assesments etc, but in the past I have ssalary sacrificed, so understand the pain it will cause at an individual level.

Interested to hear everyones thoughts.

[vzss05]

Krud hard at work again. I currently novate lease my SS, however I'm currently doing over 20k a year just in work travel and 10 a year for private use. If the rate was to go up this would cost me 5k a year. The other option take the 22k a year I get for my lease as income, pay out 45% of it in tax and still fund a car and maintain it and pay out of my pocket all related expences.

This would have a massive impact on me financially. I swear there is less and less incentive these days to work hard and make something of yourself. Maybe I should downgrade jobs, then I could be entitled to all these wonderful benefits being handed out at the moment instead of being screwed again!:flipoff:

[KCB50L]

All I can say is I didn't vote for the ****wit, not my fault.

[SS Enforcer]

This is your "Christian Socialist" government hard at work. Give cash and more cash to the poor and fragile businesses in our society whilst punishing the middle class with more taxes and charges:flipoff:

It's hardly giving to the poor and why shouldn't everybody pay the same for their cars ?
Why should the Aussie taxpayer fund your car as the average joe doesn't get a tax break on his car when he buys it.

If you need a car for work you can claim that percentage of it or get your boss to supply one and pay the FBT.

cheers




Re salary sacrificing, for the majority of people it is a bit of a rort available to a limited amount of people. Most white collar/professionals can take advantage of it, whereas blue collar workers usually cannot. Most people who salary sacrifice a car use it for personal use only, not for work use (and driving to and from the office is not work use - hence public transport costs not being tax deductible for everyday work commuting etc). So is it fair? Depending on what side you are on will generally determine the answer.




If the rort was available to everyone it would have been shutdown ages ago.


cheers

[Steve-LS2]

I don't really think that the change in the FBT affects the local car industry at all. Really it is just dictating that you purchase a car that is more in your financial bracket, in other words buy an astra instead of commodore, something along those lines. At the end of the day they know that we all need cars so it is only going to affect a pretty small few who have multiple cars due to the tax break.

Many car purchases over the last 3 years have been on a WANT basis, not a NEED basis, if people bought cars they NEEDED, 4x4's and Sports Cars would not exist.

Salary Sacrifice is not a Tax Break of the wealthy, many companies now offer them to ALL employees and as a result pay less Payroll tax aswell due to the drop in Gross Payments lowering as a result of the sacrifice.

Rudd is simply trying to find more money to pay for all of his ridiculous vote grabbing schemes.

[vzss05]

All I can say is I didn't vote for the ****wit, not my fault.

That makes two of us!


Re salary sacrificing, for the majority of people it is a bit of a rort available to a limited amount of people. Most white collar/professionals can take advantage of it, whereas blue collar workers usually cannot. Most people who salary sacrifice a car use it for personal use only, not for work use (and driving to and from the office is not work use - hence public transport costs not being tax deductible for everyday work commuting etc). So is it fair? Depending on what side you are on will generally determine the answer.


Mate I'm not the majority, I use my car mainly for work! i already pay a higher % of tax than most people, are forced to pay a medicare levy or private health, don't qualify for free handouts so I am sick of having to keep paying to support everyone else. Im not well off by any means, however this govt believes if your household earns over 100k you are. I can tell you my wife has to return to work after we have a baby in a few months so we can keep paying the bills!! Once again the middle class get screwed and you wonder why you make an effort to work your way up in life!!! Sorry, end of my rant:soap:

[Steve-LS2]

It's hardly giving to the poor and why shouldn't everybody pay the same for their cars ?
Why should the Aussie taxpayer fund your car as the average joe doesn't get a tax break on his car when he buys it.

If you need a car for work you can claim that percentage of it or get your boss to supply one and pay the FBT.

cheers



If the rort was available to everyone it would have been shutdown ages ago.


cheers

What do you Think FBT is??

I novate my SS and I will just scrape through the 15,000 mark by the end of my first year.

My FBT voluntary payments are about $165 per week, I do this to make sure I don't get a massive tax bill at the end of the year.

The only benefits to the scheme are all the running costs are exclusive of GST and essentially my marginal tax rate is subtracted from all the costs.

The other benefit is to the employer that gets to use the GST cost of the lease to them as a GST Input Credit, if people stop taking out leases then companies lose too.

So overall, this is not good for the car market or for business or for individuals, so why would the KRudd government do it??

Because people who take out Novated leases don't fit into their 'Working Families' demographic so we get screwed while the poor people get all our tax dollars in pre-christmas vote-buying presents

[Waughy]

We were having this discussion in the office this morning.

So there are two options:

A. Introduce flat rate of 26% immediately, and retrospectively.
My costs go up $13903 per year across my two vehicles
End result: The second hand market is flooded and I lose a LOT of money
End result2: People stop buying new cars

B. Introduce flat rate of 26% for new ss arrangements, grandfather old rates for existing ones.
End result: I never upgrade my cars, keep these ones going until they fall apart.
End result2: People still stop buying new cars





I like option B if it is going to be introduced, otherwise I'm boned. 3.5 years left on my lease, would love to get out of it as it isn't helping as much as it appeared it would, can't afford to get out of it in any way at the moment.

[vzss05]

Because people who take out Novated leases don't fit into their 'Working Families' demographic so we get screwed while the poor people get all our tax dollars in pre-christmas vote-buying presents

Very True!

[tim_k]

It's hardly giving to the poor and why shouldn't everybody pay the same for their cars ?
Why should the Aussie taxpayer fund your car as the average joe doesn't get a tax break on his car when he buys it.

If you need a car for work you can claim that percentage of it or get your boss to supply one and pay the FBT.

cheers



Fact is, there are those that have and those that don't have in this world. The incentive to buy a new car was, in my opinion, a good way to get people into newer, safer, more environmental (seriously) cars. The flow on effect would lower the cost of second hand cars and get people who cannot afford a brand spanker into something that is safer and get all of the rusty deathtraps off the road.

With all of the millions Krudd has pumped into the auto industy in Australia, I'm suprised it hasn't been nationalised and renamed Hordoyta.

[Veeate]

After leasing (novated) 3 x HSV cars for the past 9 years (3 year lease each car) i have decided to buy out my latest car in March when the lease expires. This decision was taken months ago before this latest FBT 'threat' from the government.

To be honest i am not sure of the advantages of FBT leasing vs any other finance option for a car. It is very convenient having a novated lease since every month some $'s come out of my salary and then i don't pay anything else. But have i really saved huge $'s like some FBT calculator says i would...i very much doubt it.

I do 25,000km a year to try and get the most benefit from FBT. And while i have enjoyed doing the km's every year i have had enough of getting to Jan each year and being about 4,000km short and having to make it up through trips etc. Good fun but there is a cost to doing it.

Talking of the whole FBT tax bracket and the fact that the more you travel the less tax you pay.....i wonder how long before that changes. With the whole 'green' thing coming on strong i think it is just silly that the more you travel, and thus the more you pollute, the less tax you pay. There has to be a better and more eco friendly way of assessing a persons tax rate on FBT.

[AndrewW]

Talking of the whole FBT tax bracket and the fact that the more you travel the less tax you pay.....i wonder how long before that changes. With the whole 'green' thing coming on strong i think it is just silly that the more you travel, and thus the more you pollute, the less tax you pay. There has to be a better and more eco friendly way of assessing a persons tax rate on FBT.

I agree with that completely, I've always thought it strange that you pay less tax if you do more kilometres.

But then I don't make the rules, I just follow them.

Oh to be back in the good old days when FBT was nothing more than a treasurer's wet dream.

[the big fist]

Many car purchases over the last 3 years have been on a WANT basis, not a NEED basis, if people bought cars they NEEDED, 4x4's and Sports Cars would not exist.

Salary Sacrifice is not a Tax Break of the wealthy, many companies now offer them to ALL employees and as a result pay less Payroll tax aswell due to the drop in Gross Payments lowering as a result of the sacrifice.

Rudd is simply trying to find more money to pay for all of his ridiculous vote grabbing schemes.

Which is what I said in my previous posts. We WANT HSV GTS's, we only NEED little astra's :p

[adamw1]

I think you need to separate thoughts about MP entitlements and Salary Sacrificing of motor cars. Lets be honest, MP have quite a low base salary for the responsibility thye have, so perks make up for it. One of the reasons why we have ordinary politicians perhaps???? Not enough incentive for people with some talent to go into that type of job.

Re salary sacrificing, for the majority of people it is a bit of a rort available to a limited amount of people. Most white collar/professionals can take advantage of it, whereas blue collar workers usually cannot. Most people who salary sacrifice a car use it for personal use only, not for work use (and driving to and from the office is not work use - hence public transport costs not being tax deductible for everyday work commuting etc). So is it fair? Depending on what side you are on will generally determine the answer.

Whilst I agree the novated lease has helped sell a lot of cars over the past few years, has it really help the local industry? Personally I don't think so, it has only helped the importers. The local industry was proped up by companies purchasing Commodores, Falcons and Camrys for their employees for a long time. Maybe with the mooted changes this might help again. The other side the coin is that 'choice' may be taken away.

I lease my car, burt this time have decided to use a post tax or hire purchase lease. it works better for me in terms of child support assesments etc, but in the past I have ssalary sacrificed, so understand the pain it will cause at an individual level.

Interested to hear everyones thoughts.

Everything you have said is pretty much spot on.

If you are genuinely doing business km's then you can already claim those (up to quite a reasonable limit) through the work-related deductions system. If you are leasing for predominantly personal use, why should it be tax deductible - why do I or any other tax payer have to contribute to that? There is no counter-argument, anyone in that situation will respond "well why should I contribute to welfare" etc.

I claim my business km's through the work-related deductions system and receive a pretty decent $5000 deduction per year.

I also find it hard to believe that the quotes/calculators people use when deciding to choose a novated lease actually have any basis in reality after all is said and done... I'd be willing to bet that in most circumstances the end savings were much smaller than expected.

[SS Enforcer]

If you are genuinely doing business km's then you can already claim those (up to quite a reasonable limit) through the work-related deductions system. If you are leasing for predominantly personal use, why should it be tax deductible - why do I or any other tax payer have to contribute to that? There is no counter-argument, anyone in that situation will respond "well why should I contribute to welfare" etc.



My thoughts exactly if it's your personal car pay for it like everyone else has too.

cheers


That makes two of us!



Mate I'm not the majority, I use my car mainly for work! i already pay a higher % of tax than most people, are forced to pay a medicare levy or private health, don't qualify for free handouts so I am sick of having to keep paying to support everyone else. Im not well off by any means, however this govt believes if your household earns over 100k you are. I can tell you my wife has to return to work after we have a baby in a few months so we can keep paying the bills!! Once again the middle class get screwed and you wonder why you make an effort to work your way up in life!!! Sorry, end of my rant:soap:

I am in the same boat as you, at least you got the baby bonus that was something else I had to pay for I didn't get. We have a high household income and lots of expenses but I don't think I should get a better deal than anyone else. If I loose the tax break on my car tomorrow so be it, I didn't buy it for the tax break .

How is it the middle class is getting screwed again .

cheers

[vzss05]

My thoughts exactly if it's your personal car pay for it like everyone else has too.

cheers



I am in the same boat as you, at least you got the baby bonus that was something else I had to pay for I didn't get. We have a high household income and lots of expenses but I don't think I should get a better deal than anyone else. If I loose the tax break on my car tomorrow so be it, I didn't buy it for the tax break .

How is it the middle class is getting screwed again .

cheers

How? You agree, you dont qualify for the entitlements, you wouldnt have received the same tax cut in % as low income earners. Despite not probally using it, pay a higher % of income to prop medicare and the health system up etc etc

And when this govt wants to keep being santa claus giving away cash instead of building infrastructure to promote real growth, who's going to pay for it??????? You and me. Thats how mate

[Devil CV8]

My thoughts exactly if it's your personal car pay for it like everyone else has too.

I am, just using pretax money...
I pay out of my pretax income and lower the tax I pay, and to paraphrase the words of Kerry Packer "any one who doesn't pay the lowest amount of tax they can is a fool"
I started a 5 year novated lease on a SS ute, if novated leases weren't available I wouldn't have done it which would have meant one less car sale. multiply that by all the novatees that would have made the decision to not purchase new and see how this proposed change is going to have a bad affect on new car sales.

[SS Enforcer]

I don't have a problem with leasing or minimising their taxable income but if it isn't available to everyone it becomes unfair. It means new car purchase are being subsidised by the rest of us who don't have salary sacrifice for vehicles available to them. If part of the new car buying scheme was the ability for all to take advantage of a scheme like this I would be all for it.

If they wanted to stimulate vehicle sales this could be a way to do it but not for a select few only.

cheers

[lowriding]

I don't have a problem with leasing or minimising their taxable income but if it isn't available to everyone it becomes unfair. It means new car purchase are being subsidised by the rest of us who don't have salary sacrifice for vehicles available to them. If part of the new car buying scheme was the ability for all to take advantage of a scheme like this I would be all for it.

If they wanted to stimulate vehicle sales this could be a way to do it but not for a select few only.

cheers

yeah well said . Even though i am eligible for S/Sac i do believe a personal tax break like it should be available to all if it exists .funny enough the biggest 'rorter' of this scheme has always been any Govt entities or "privatised" govt entities (councils/telstra/integral/water board etc etc etc)so it will be interesting to see it being rolled back .

[SICK SS]

Can some explane how this will affect me i lease a car through my company it cost me $496 a week before tax and i drive 25001km a year i could easyly do another 5000km a year if need be. I dont realy understand what they are proposing.

[chook]

Can some explane how this will affect me i lease a car through my company it cost me $496 a week before tax and i drive 25001km a year i could easyly do another 5000km a year if need be. I dont realy understand what they are proposing.


In simplistic terms using 50K as the capital cost as an example. Your FBT p/a is currently $5500., based on 11% FBT rate. If the proposed changes come in and they change the rate top the highest rate 26% or higher, Your FBT component will change from $5500 to $13000. Big Differnce. If this comes in alot of people are going to be screwed.

[FITZY777]

I don't have a problem with leasing or minimising their taxable income but if it isn't available to everyone it becomes unfair. It means new car purchase are being subsidised by the rest of us who don't have salary sacrifice for vehicles available to them. If part of the new car buying scheme was the ability for all to take advantage of a scheme like this I would be all for it.

If they wanted to stimulate vehicle sales this could be a way to do it but not for a select few only.

cheers

The option to salary sacrifice via a novated lease is avaiable to all employees, it is only the employer that would make it not happen (too hard, cant be bothered OR uneducated).

But the benifit gained is greater for the higher income earner, as they would only be paying 11% FBT (using 25001 km per year as an example), rather than a tax rate applicable to their earnings.

With recent changes to the tax brackets, many more of us in the middle income range have seen this benifit decrease, where it is basically on par, but we do still have the Employee Contribution method, where after tax $'s are deducted up to the value of the FBT calculated on the purchase price of the vehicle.

This can be seen as a savings bucket, as any REPAIRS to your vehicle, i.e. replace rusted exhausts, or replace cracked heads etc. You can then either submit this to your employer to be reimbursed (as I do), or wait until the FBT reconcliation is completed after April each year. So basically you get around $5,500 worth of repairs (based roughtly on a $50k purchase) that would have normally gone to the ATO as Fringe Benifits tax.

Pretty sure all I have said is correct, if not then someone please correct me.

So yeah, removing the FBT benifits, just like altering the rules for notebooks, would suk big time.

Cheers

Fitzy

[Dacious]

Costello screwed private sal-sac leasing for employees in his last budget. After raising the marginal tax rate to $75K, you had to be earning over $100K per annum for sal-sac to work on a 15,000km lease on a $5K or more car. This is becaiuse lowering your marginal taxes offset the FBT. Part of the reason the arse has fallen out of Falcon and Commodore sales since is user-choosers either aren't renewing or they're going for cheaper cars. Many people I know simply bought their last lease car.

I used sal-sac on the Monaro before I bought it off the lease, but it really had become middle-class welfare and an inequitous lurk - and that sort of taxpayer-funded subsidy is quite unfair if everyone can't access it. Why should I be able to lease a car at virtually no interest and having someone else pay the GST just because of who I work for?

It was only ever intended when introduced all those years back that the self-employed who needed a vehicle for business could get one and expenses at a concessional tax-free rate. Of course, for the Libs it's handy that their demographic - doctors, lawyers, company directors - all got dibs, too. So Costello's changes enhanced their standing and entitlements - and shut the hoi-polloi out of something only the 'right sort' of people should be able to access from the Liberal voters' point of view. They would no doubt rate Costello a capital fellow because of it!

[ls3r8]

all you blokes whinging that it's not available to everybody, take it up with your employer! as FITZY777 said, anybody can do it, if THEIR EMPLOYER wants to. If you want to get involved, HIT THEM UP, or CHANGE EMPLOYERS. You don't have to be a rocket scientist to access these benefits, or figure them out

[Devil CV8]

all you blokes whinging that it's not available to everybody, take it up with your employer! as FITZY777 said, anybody can do it, if THEIR EMPLOYER wants to. If you want to get involved, HIT THEM UP, or CHANGE EMPLOYERS. You don't have to be a rocket scientist to access these benefits, or figure them out
agreed 100%


If you want to talk vehicle rorts, the 2 biggest rorts would have to be federal politicians with their taxpayer funded vehicles (and lets throw SES vehicles in as well) and Telstra's operating lease vehicles. Managed to have the Telstra vehicle in my last job and it went something like this:
cost to me $1330 gross per month for a VZ SV6
car went back with 172,000km after 2 years (110,000 in one year) and had 4 sets of tyres, 2 (or was it 3) windscreens, 3 accident repairs of approx 4k each (2 were 4k, not sure about the third) along with all services and mechanical repairs. I was spending more than 1400 in fuel in some months, more than what I paid for the car.
then 1900 (approx) for a SSV on a 3 year operating lease.
did 22,500 km over 4 months before I changed jobs and had to hand it back, all at no penalty to me.

[SV346]

Anything with poor community family man poverty stricken crudd is going to be a load of s..t, oh yay he gives everyone so much to look foward to, good on him for being a deads..t, all he does is have nice little speeches with big words and thats meant to be good politics... Im glad i didnt vote for the c..t :)

[GameON]

You guys are kidding right? How is it fair that if you do 40k a year you pay basically no FBT - I've never figured it out...

Maybe bring in two tiers - one for < 15k, one above.

Make it fairer for all.

At the moment it is a massive rort and leads to people putting more k's on cars for no good reason...

As for the people whining about not being able to afford their house and car without the rest of Australia subsidising you - tough titties! Being a young bloke without any kids I've had to work my ass off and pay for middle class welfare for too long - if you can't afford something, don't buy it!

[SICK SS]

You guys are kidding right? How is it fair that if you do 40k a year you pay basically no FBT - I've never figured it out...

Maybe bring in two tiers - one for < 15k, one above.

Make it fairer for all.

At the moment it is a massive rort and leads to people putting more k's on cars for no good reason...

As for the people whining about not being able to afford their house and car without the rest of Australia subsidising you - tough titties! Being a young bloke without any kids I've had to work my ass off and pay for middle class welfare for too long - if you can't afford something, don't buy it!

this is just my take on it if you do more km you buy more fuel/tyres/services so your puting more money back into the ecconomy. I just love the fact with lease cars you just jump in and drive if it dose go up to 26% it cost me an extra 120 a week but il still lease again its just so easy.

[Devil CV8]

You guys are kidding right? How is it fair that if you do 40k a year you pay basically no FBT - I've never figured it out... easy, we still pay FBT (7% I believe is the rate) as well as the extra runnings cost that WE still pay.

As for the people whining about not being able to afford their house and car without the rest of Australia subsidising you - tough titties! Maybe you can explain where taxpayers are subsidising me for my novated lease. I pay for my lease car out of MY money. The fact it is before tax doesn't cost you anything.


Being a young bloke without any kids I've had to work my ass off and pay for middle class welfare for too long - if you can't afford something, don't buy it! Being a middle aged block with a wife and adult kids, guess what I've worked my ass off and haven't had any handouts. No first home buyers grant, no baby bonus, no inheritance. all through both mine and my wife's hard work.

[FITZY777]

easy, we still pay FBT (7% I believe is the rate) as well as the extra runnings cost that WE still pay.
Maybe you can explain where taxpayers are subsidising me for my novated lease. I pay for my lease car out of MY money. The fact it is before tax doesn't cost you anything.

Being a middle aged block with a wife and adult kids, guess what I've worked my ass off and haven't had any handouts. No first home buyers grant, no baby bonus, no inheritance. all through both mine and my wife's hard work.


Agree

Agree

Agree


I wonder how much money could be saved by scrutinising dole bludgers, or forcing them into volunteer work after a certain period of time if they are physically able to work ??

[SS Enforcer]

. The fact it is before tax doesn't cost you anything.



It does cost us all actually, if you were paying your car with after tax dollars there would be more tax paid to the government. The rest of us do in fact subsidise this scheme.

I tried to get a leasing company in at work and they wouldn't do it I even arranged a company that would do all the work and the pricks still wouldn't go for it. We still can claim our cars as a work expense anyway and it's a worthwhile thing to do in my case but I think we all should be able to not just people in jobs that qualify.

cheers

[GameON]

easy, we still pay FBT (7% I believe is the rate) as well as the extra runnings cost that WE still pay.


So - you pay your car out of pre-tax money, and then only have to pay 7% tax on that money, while we subsidise the other (i'll assume) 40ish%??? And you pay the cost of the car you drive - heroic.



Being a middle aged block with a wife and adult kids, guess what I've worked my ass off and haven't had any handouts. No first home buyers grant, no baby bonus, no inheritance. all through both mine and my wife's hard work.


I'm not here to argue about who's had it tougher - I could go on all day about that :)... however I think it's a bit rich that people are on here complaining that they wont be able to afford an new R8 or GTS every two years as a daily driver because the government won't give them 20k for the pleasure!

Anyway with that I'm off to see the family - merry christmas everyone!

[Waughy]

What, so all you that are against novated leasing, claiming it's costing you, do you think that if it is abolished, or changed as proposed, that you are going to get a tax cut and pay less?
Dreamtime ended a long time ago.
Yes I'm leasing the Captiva, I wish I didn't as the calculations done prior to taking it have turned out to be crap. I did it to make things a bit easier for me financially after the wife shot through for no good reason then went me for child support. And I pay child support based on what my salary would be normally, not using the lease to dodge things there, though I could, the way she carries on sometimes.
I do agree with the comments about people sulking that they won't be able to afford a new R8 every 2 years though. I'll never be able to afford one. Whatever the Gov does, we either aceept it and live with it, or stop leasing our cars if it's no good for us any longer. But no way will those not leasing benefit in any way, you'll still pay the same taxes etc.
Merry Christmas to all.

[Devil CV8]

It does cost us all actually, if you were paying your car with after tax dollars there would be more tax paid to the government. The rest of us do in fact subsidise this scheme. Even if I paid for this car with after tax money and therefore paid more tax, do you really believe you would pay less tax? Your tax paid won't change wether or not novated leases are available to the rest of us, so the subsidise argument is null and void.


I tried to get a leasing company in at work and they wouldn't do it I even arranged a company that would do all the work and the pricks still wouldn't go for it. We still can claim our cars as a work expense anyway and it's a worthwhile thing to do in my case but I think we all should be able to not just people in jobs that qualify.

cheers so your bitter because your employer won't allow novating. Good, just so we know where you're coming from.



So - you pay your car out of pre-tax money, and then only have to pay 7% tax on that money, while we subsidise the other (i'll assume) 40ish%??? as I said above, your tax paid won't change if novated leases are abolished.

And you pay the cost of the car you drive - heroic. ahh sarcasm, the argument of mental giants.


I'm not here to argue about who's had it tougher - I could go on all day about that :)... you started on that path, not me.

however I think it's a bit rich that people are on here complaining that they wont be able to afford an new R8 or GTS every two years as a daily driver because the government won't give them 20k for the pleasure! Everyone is entitled to minimise their tax paid using legal methods. I guarantee there isn't one person on this forum who doesn't minimise their tax bill. Depending on the industry you work in depends on what means are available to you. If the rules change and people suddenly need to change their novated leasing habbits, so be it. The tax rules change all the time


Anyway with that I'm off to see the family - merry christmas everyone! same to you and yours.

Stay safe out there everyone

[SS Enforcer]

Even if I paid for this car with after tax money and therefore paid more tax, do you really believe you would pay less tax? Your tax paid won't change wether or not novated leases are available to the rest of us, so the subsidise argument is null and void.

so your bitter because your employer won't allow novating. Good, just so we know where you're coming from.


as I said above, your tax paid won't change if novated leases are abolished.
ahh sarcasm, the argument of mental giants.



I didn't say it should be abolished but it should be available to all and not just who you work for. The average Joe is in effect subsidising these purchases.

Personally it doesn't affect me as 80% of all my costs + depreciation is tax deductible for me due to the industry I work in.

People who get tax breaks on their vehicles arn't going to get much sympathy from those who don't if they have to pay a few bucks more .

cheers

[Devil CV8]

Personally it doesn't affect me as 80% of all my costs + depreciation is tax deductible for me due to the industry I work in.

cheers
pot meet kettle.

Isn't that unfair. Shouldn't everyone be able to claim 80% of costs + depreciation? (seriously, good for you being able to claim that)
but!!
Personally I think it's a bit hypocritical for people to complain about one form of tax break (Novated leasing) while taking full advantage of another.

[adamw1]

Its a cost of doing business and earning an income.

Novated leasing is not.

No doubt we'd pay the same tax without paying for people's luxury cars, but at least that money could be spent on something more worthwhile (hospitals for example).

[SS Enforcer]

pot meet kettle.

Isn't that unfair. Shouldn't everyone be able to claim 80% of costs + depreciation? (seriously, good for you being able to claim that)
but!!
Personally I think it's a bit hypocritical for people to complain about one form of tax break (Novated leasing) while taking full advantage of another.

I think everyone should get the same break actually and if they closed it or changed the rules I would have to accept it which I would.

cheers