What is a novated lease?

A novated lease is a finance arrangement for employees. It allows you to 'salary sacrifice' part of your pre-tax income to pay for your car and its running costs. This arrangement is attractive to many people because it can reduce taxable income. Here’s how it works:

  1. You and your employer sign a novated lease agreement with us and you get a car for your use.
  2. Your employer makes the lease repayments on the car and takes this amount from your pre-tax salary.

To determine whether a novated lease is the best option for your circumstances, we suggest getting independent tax advice from an accountant or financial adviser.


Here's what you get with a novated lease.

  • The certainty of a fixed rental amount for the length of your lease

  • A lease term generally between 12 and 60 months

  • Choose the vehicle you want, and we will buy it and lease it back to you

Eligibility and application

What you need to be eligible for a novated lease.

  1. Your employer is an ABN holder and is registered for GST.

  2. You're over 18 and a permanent Australian resident.

  3. You have a Tax File Number.

  4. You're an employee and earn a PAYG salary.

  5. Your employer is willing to make the payments from your pre-tax salary.

The benefits of a novated lease

Enjoy a lease that gives you flexibility and convenience.

Flexible lease options

Choose from a variety of lease structures to suit your personal or professional needs.

Salary sacrifice your car lease

Payments are taken from your pre-tax salary by your employer.

Choose the vehicle you want

Get unlimited private use of your vehicle during your lease.

Fees and charges

What it costs to get started.

Upfront deposit

$ 0

Get the vehicle you need with no deposit upfront.

Monthly fees

$ 0

No additional monthly fees for maintaining your finance lease.

Initial set up fee

$ 550

Includes $522.50 Documentation and Settlement fee (inc GST) and $27.50 Personal Property Securities Register (PPSR) Registration & Maintenance fee (inc GST).

How a novated lease works

Apply for novated lease in four easy steps.

Step 1: Choose your vehicle

Find the right vehicle for your needs.

Step 2: Apply

You can apply over the phone or in any NAB branch with a NAB Business Banker.

Step 3: Sign documents

We’ll prepare the documents for you and your employer to sign.

Step 4: Collect the vehicle

Once we receive your documents and your vehicle is ready to be collected, we’ll pay the supplier within one business day.

What will my repayments be?

Your rental payments will vary depending on what you're looking to buy, so let our NAB equipment finance specialist tailor a solution for you. We offer a range of flexible repayment structures to suit your individual needs.

Novated lease: Vehicle and equipment fact sheet

Understanding novated leases.

  • If your new employer agrees to take the payments from your pre-tax salary then the lease and the vehicle can move to your new job.

    If your new employer does not agree, you will still get to take your car with you and are responsible for the remaining lease payments.

  • Unfortunately not. We need to pay for 100% of the vehicle’s cost and cannot accept a deposit or proceeds of a trade in.

  • Additional fees may apply if you:

    • already own the vehicle or equipment
    • are buying the vehicle or equipment from a person or business that:
      • doesn't have an ABN
      • isn't registered for GST
      • doesn't generally sell this type of equipment as part of their normal course of business.
    • are purchasing specialised equipment
    • want to make a change to the loan after it has been drawn down.

    Find full details in our Business Banking Fees and Charges guide.

  • At the end of the lease term:

    • you must return the goods to NAB
    • you can make an offer to purchase the goods
    • you can make an offer to lease the goods for a further term.
  • If you’ve already paid for the vehicle or equipment, it’s not too late – we may be able to buy it from you, reimburse the cost, and lease it back to you.

  • You have the freedom to choose new or used vehicle, from a dealer or a private seller (as long as they have an ABN and are registered for GST).

Calculators and tools

Use our tools and calculators to help you plan and run your business.

Help and support

Use our range of guides and tools to help you plan and manage your business.

Other ways we can help

Use our help guides, FAQs and other support services to help you manage your unique business.

Other lease and loan options to consider

Choose from a range of business lending products.

Contact us

Request a call back

Let us help you with your business banking needs.

Call us

Call us for your general enquiries about business banking.

Visit a NAB branch

Use our locations tool to find business banking services.

Terms and Conditions

Lending criteria and terms and conditions apply (available on application).

The tax comments provided in this document are of a general nature. NAB recommends that you seek independent tax advice in respect of the tax consequences arising from the use of any NAB Equipment Finance solution as they apply to your particular circumstances.

These products are issued by National Australia Bank Limited ABN 12 004 044 937.