I have a friend who wrote his car off in a prang, yes his fault, but you can't pick when and how you have an accident and the company hit him up for the rest of the cost of the new car because the insurance only covered the cost of the car, not the rest that you would pay for rego fuel atc, he had an enormous bill at the end.
I have also got friends who've been hit up massively at tax time because they haven't done the required amount of kms.
Saying that though we're seriously looking at it too.
Yes, I have a friend that chose the 25,000km option and every so often they have to go for looooong drives just to increase the km's. We calculated how many km's the car would travel so are going for a 15,000 km option to be safe.
Thanks for letting me know about the friend that crashed a leased car, definately a question I'll make sure DH asks when he speaks to them tomorrow.
Leesa, if that is the case and you wont be doing a lot of Km's in the car, you have to look at what that will cost you in Fringe benefits tax if you don't do them. We have ours set for 25,000km per year (we do around 28-29000) but if we don't meet that target, we have to pay 11% FBT, and that amount gets higher for the less amount of KMs you nominate. So if you only nominate 15,000kms, but don't do them, you could be paying a lot more than 11% FBT. Each month you will receive a statement from the leasing company telling you what your KM's are etc and if you are on track to meet your target Kms. And another thing I forgot to say too was that when we got our car, it was all registered and insured for personal use, but this year the company realised they'd screwed up and we had to change over all the insurance and registration to business use - which is what it should have been registered as in the first place as technically DH's employer own the car. This added nearly $500 onto our yearly rego and insurance payments. So that is something you need to factor in each month as well. You may get the benefit of salary sacrificing and not paying as much tax, but it may not be for much gain if you are paying higher running costs overall kwim?
In a way I am glad I don't lease anymore (even though I absolutely loved my car), because I know that I wouldn't get the KM's I needed to here. It was easy when I was doing a 70km round to work and back 5 times a fortnight plus other driving, but when DP's work is only 3 km's away, I wouldn't come close to reaching 15000km.
!
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