Great video thank you for taking the time. I have spent a few months researching this and this video was perfect for making sure I was on track in my understanding
SOLID! Thank you. Kicking myself for buying the Model Y outside of my health job in Oct '22. :( But have shown this video to friends. Also, in SA we're majority renewables :) and I charge off our own solar 85% of the time :) The comparison I'd love is buy with cash post-tax vs Salary package/Novated Lease with FBT exemption. I have trouble assesing all the little nuances of novated leases.
Hi Derek. Great video. If my business makes 80k profit and I pay 80k wage to myself. Now business profit is 0. Instead of 80k cash, its salary sacrificed to an 80k ev car. Does the fbt exemption apply? I understand I still pay super on the 80k wage.
Hi Derek - just clarifying- if I’m already salary sacrificing 16,500 and entertainment card of 2500 - can I further salary sacrifice the EV car - on top of what already doing - so 18500 plus additional SS of car - I work for non profit
Hi Derek, love your webinars. Is it better to buy an EV with your own cash if you have the savings, or do a novated lease as an employee for a not-for-profit? The numbers we ran were in favour of buying outright with own cash due to the extra fees charged for the novated lease. Would love to get your thoughts!
it basically comes down to the interest rate and the 'opportunity cost' of using your own money. Do you think you can earn more by investing you cash elsewhere (or reducing other debt) than what the interest charged on the car loan will be? is the interest on the car loan lower than your home loan?
Interested to know if secondhand imported EVs, sold and registered for the first time in Australia after 1 July 2022, but having been previously sold and used in an overseas market, are deemed as 'first held and used' under this scheme, based on being new to the Australian market?
There are updates coming soon from the ATO, but as it stands right now your above example would not be exempt as the legislation makes no mention of where the EV was first used. I don't see how an electric car first used before or after 1 July 2022 would make any difference to the goal of reducing CO2 emissions, but them the rules. derek
Thank u. Very clear. I have one question. In determining LCT, do dealer delivery costs, stamp duty, insurance and rego count towards that threshold figure of 84, 916 ? Or is it simply the RRP plus GST ? Thnx
@@TwelveAccounting Hi Derek, can you please confirm if stamp duty is included? See the notes from ATO (www.ato.gov.au/Business/Luxury-car-tax/Working-out-the-LCT-amount/Working-out-the-LCT-on-a-sale/): The LCT value does not include: LCT included in the sale other Australian taxes, fees or charges such as stamp duty, transfer fees and registration compulsory third-party insurance (CTPI) extended warranties costs associated with financing the purchase of the car service plans.
Hey Derek, thanks for the really thorough info! Quick question: Is it better financially to buy an EV via a novated lease / salary sacrifice as an employee of my own company? Or buy it as a company owned fleet vehicle and use it for personal use?
@@zpatrick9145 there isn't any difference between the two examples. the tax deduction is with the employer in both situations and there won't be any FBT applicable. derek
Derek, with this question (buying it in the company versus in personal name and packaging it. Wouldn't the company only get the tax savings at 25% as it's a business expense, whereas if it's packaged it would be from pre tax salary which would be a savings at marginal rate (upto 45%)?
Hi Derek, among the following three dates, which one do I to determine the fiscal year for which the tax deduction can be applied? 1. Full payment date (actual money transfer). 2. Invoice date. 3. Car registration date. 4. Physical car delivery date. - many thanks.
Hi Anton, For most companies it is the date of the invoice, however some businesses operate on a cash basis, so this would be the date of payment. derek
Thank you very much - great video. Does the GST exemption apply to the whole purchase price or just the amount above the residual “bubble” amount? You didn’t mention the compulsory “bubble” amount that I believe is set by the ATO. Are there any extra taxes (such as GST) payable on the residual?@@TwelveAccounting
Thanks so much for the RFBT. I've been searching for that!!! Have gone to 2 accountants and a financial advisor. Is there an exact way to work it out? It puts me close to a threshold
Great video thank you for taking the time. I have spent a few months researching this and this video was perfect for making sure I was on track in my understanding
SOLID! Thank you. Kicking myself for buying the Model Y outside of my health job in Oct '22. :( But have shown this video to friends.
Also, in SA we're majority renewables :) and I charge off our own solar 85% of the time :) The comparison I'd love is buy with cash post-tax vs Salary package/Novated Lease with FBT exemption. I have trouble assesing all the little nuances of novated leases.
EV is a no-brainer to salary package it. Novated lease is just the way your employer would finance it under a salary package arrangement. derek
Great video, thanks. Is there any update yet from ATO on calculating electricity cost?
$0.042 per km. derek
Hi Derek. Great video. If my business makes 80k profit and I pay 80k wage to myself. Now business profit is 0.
Instead of 80k cash, its salary sacrificed to an 80k ev car. Does the fbt exemption apply? I understand I still pay super on the 80k wage.
Great content keep it up
Hi Derek - just clarifying- if I’m already salary sacrificing 16,500 and entertainment card of 2500 - can I further salary sacrifice the EV car - on top of what already doing - so 18500 plus additional SS of car - I work for non profit
yes. the not-for profit salary sacrific is a completely different FBT exemption. derek
Sorry to piggyback on this question. Would it be more beneficial if we we were to do all three? (Salary sacrifice $18500 + additional SS of car)
Hi Derek, love your webinars. Is it better to buy an EV with your own cash if you have the savings, or do a novated lease as an employee for a not-for-profit? The numbers we ran were in favour of buying outright with own cash due to the extra fees charged for the novated lease. Would love to get your thoughts!
it basically comes down to the interest rate and the 'opportunity cost' of using your own money. Do you think you can earn more by investing you cash elsewhere (or reducing other debt) than what the interest charged on the car loan will be?
is the interest on the car loan lower than your home loan?
Interested to know if secondhand imported EVs, sold and registered for the first time in Australia after 1 July 2022, but having been previously sold and used in an overseas market, are deemed as 'first held and used' under this scheme, based on being new to the Australian market?
There are updates coming soon from the ATO, but as it stands right now your above example would not be exempt as the legislation makes no mention of where the EV was first used.
I don't see how an electric car first used before or after 1 July 2022 would make any difference to the goal of reducing CO2 emissions, but them the rules. derek
Thank u. Very clear.
I have one question. In determining LCT, do dealer delivery costs, stamp duty, insurance and rego count towards that threshold figure of 84, 916 ? Or is it simply the RRP plus GST ? Thnx
the delivery costs and stamp duty are included, but not the rego and insurance. derek
@@TwelveAccounting Thnx !
@@TwelveAccounting Hi Derek, can you please confirm if stamp duty is included? See the notes from ATO (www.ato.gov.au/Business/Luxury-car-tax/Working-out-the-LCT-amount/Working-out-the-LCT-on-a-sale/):
The LCT value does not include:
LCT included in the sale
other Australian taxes, fees or charges such as stamp duty, transfer fees and registration
compulsory third-party insurance (CTPI)
extended warranties
costs associated with financing the purchase of the car
service plans.
Hey Derek, thanks for the really thorough info! Quick question: Is it better financially to buy an EV via a novated lease / salary sacrifice as an employee of my own company? Or buy it as a company owned fleet vehicle and use it for personal use?
if you have your own company, i would be looking at buying it in the company name (you can get a Hire Purchase/Lease). derek
@@TwelveAccounting A video on this comment (own your own company) would be appreciated. Subbed for it👍
@@zpatrick9145 there isn't any difference between the two examples. the tax deduction is with the employer in both situations and there won't be any FBT applicable. derek
Derek, with this question (buying it in the company versus in personal name and packaging it. Wouldn't the company only get the tax savings at 25% as it's a business expense, whereas if it's packaged it would be from pre tax salary which would be a savings at marginal rate (upto 45%)?
Hi Derek, among the following three dates, which one do I to determine the fiscal year for which the tax deduction can be applied? 1. Full payment date (actual money transfer). 2. Invoice date. 3. Car registration date. 4. Physical car delivery date. - many thanks.
Hi Anton, For most companies it is the date of the invoice, however some businesses operate on a cash basis, so this would be the date of payment. derek
Don't you also get to save the cost of GST off the purchase price ?
yes. but that would happen for any vehicle purchase, it isn't specific to EV's. derek
@@TwelveAccounting fair enough but I think that would be of interest to someone that's considering whether to get the car without this method or not
Thank you very much - great video. Does the GST exemption apply to the whole purchase price or just the amount above the residual “bubble” amount? You didn’t mention the compulsory “bubble” amount that I believe is set by the ATO. Are there any extra taxes (such as GST) payable on the residual?@@TwelveAccounting
Thanks so much for the RFBT. I've been searching for that!!!
Have gone to 2 accountants and a financial advisor. Is there an exact way to work it out? It puts me close to a threshold