THE CAR AND TRUCK FLEET AND LEASING MANAGEMENT MAGAZINE
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Novated Lease

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In Australia, a special closed-end operational lease contract directly between an individual company employee and the leasing company.

In cases where a company car allowance is part of the compensation package and during the individual's term of employment, the employer administers the program and pays the lessor's invoices, making a payroll deduction to the extent that the lease payment exceeds the agreed upon car allowance in the compensation package.

Should the individual leave the company's employ, future monthly invoicing (to the end of the contracted lease term) and payment is handled directly between the lessor and the individual.

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