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Tips for Selling a Used Car

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Experience has taught me to be aware of people that you talk to. Unfortunately there are people out there who are dishonest when it comes to buying a vehicle that is second hand.

 

If you’re preparing to sell your car we suggest you do the following before the ad is uploaded and before the car is released to the new owner:

 

– Depending on the condition of the car and how much it’s worth, you may want to sell the car without a roadworthy and without registration, if so you need to make this very clear on the ad you post.

– Take off the registration plates (if selling without a roadworthy). Make sure if you’re doing this that you take the plates to VicRoads yourself, sometimes the buyer may try to convince you to allow them to do it.

– Whatever price you agree on with the buyer, do not change your mind. If they try to re-negotiate the price – stand firm and don’t let them take the car until you have the money you agreed on – when selling the car you may even get asked if you will take a much lower price (depending on the buyer).
– Take a photo of the compliance plate.

– If the buyer is car wrecker, make sure you take a photo of the car on the back of the truck and get the tow truck company’s details and the registration number of the truck.
– Get the money from the driver before he puts the car on the back of the truck.

 

The tips above came in handy for one of our own team members who recently purchased a new car and wanted to sell their old Toyota, which was worth only a few hundred dollars. When they finally met the new buyer, sure enough straight away the buyer wanted to talk down the price of the car. Having spoken to us before selling and taking on board our tips, they were prepared for this and ended up telling the buyer they will only sell the car for the agreed price and left it at that. As no surprise the buyer had the cash ready for the agreed price!

 

These simple steps may help protect you and stop you from being ripped off. Remember it often pays to get the right advice so you can make the right decision.

 

Once the car has gone, ensure you head off to VIC Roads, hand in the plates and get a refund on the registration fee.

 

Remember it pays to get professional advice which will save you any heartache later on.

JBS Salary PackagingTips for Selling a Used Car

Novated vs Associate Lease?

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We often get clients ask us which type of lease is better, a Novated Lease or an Associate Lease? The simple answer to that question is “it depends”. It depends on your financial and personal situation.

A perfect example just occurred recently when I had to run through this exercise with a potential client. He was interested in both an associate lease and Novated Lease, but more importantly he wanted to know which one would be more beneficial to him. After running through both options with him he was amazed at how a model such as an associate lease will suit him better compared to a novated lease.

The easiest way to explain the differences between an associate lease and novated lease is as follows;

An associate lease is an agreement which is taken out between the employee and their associate with the approval of the Employer (Your Partner or family members over the age of 18).

The Associate rents their vehicle to the person who is salary packaging. The objective is to get the benefits of Salary Packaging and the associate get the opportunity to write off the vehicle against their tax by claiming the depreciation of the vehicle and if there is a loan they also get to claim the interest. (Associate Lease works well if the Associate earns under $35,000 per year due to the tax benefits that are available.) We recommend that you check with your accountant before proceeding.

The way I had it explained to me is:

– An Associate Lease essentially means you are your own bank. (You finance the vehicle through your own assets. I.e. redraw on your home loan), or you may already own the vehicle or pay cash for it.

– A Novated lease on the other hand is financed via a third party (bank or financial institution).

So if you have the facility to finance your own vehicle in your associates name then an associate lease will be the right way to go. If this cannot be achieved then the Novation is better for you.

If you have a vehicle without a loan, then the Associate may possibly be better option for you. If you plan on buying a new car then in most cases the Novated Lease will be better for you. Both options could be beneficial for you depending on your personal circumstances. At JBS Salary Packaging, we will provide you with the best possible outcome that puts more money in your pocket that is for sure.

Benefits for the employer

It makes sense that all employers take advantage of Salary Packaging as they too benefit as the GST paid by the employees is passed to them in a way of the employer claiming this against their BAS Statements, assisting in reducing the employer’s tax liability as well.

 

Remember to always discuss your options with one of the team at JBS Salary Packaging to ensure it’s the right decision for you and seek professional advice!

 

JBS Salary PackagingNovated vs Associate Lease?

FY17 FBT Year Has Ended

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This is the time where we need to check your expenditure, reconcile your Fringe Benefits Taxation (FBT) and confirm any liabilities that are required to meet the Australian Taxation (ATO) Guidelines for your employer.

 

The next few weeks will be one of complying to the rules and regulations set out by the ATO and the FBT reports will be sent to your employer for processing.

 

We need you to make sure that you have submitted your vehicle odometer reading. This allows us to make sure that your expenditure meets with your budget for the 2016/17 year. This could also mean that we need to adjust your current Salary Packaging requirements to meet your actual spending.

 

Whilst we close off on the FBT Year 2016/17, we begin the 2017/18 FBT Year.

 

The ATO have changed and overhauled the rules on:

– Entertainment and meals expenses. This affects the FBT – rebatable and the FBT – Exempt Employers only.
– Uber Travel from Home to Work attracts FBT. So be careful, Uber is ineligible for FBT Exemption as the vehicle being used will not represent a “Vehicle that is licensed to operate as a taxi”.

 

There are also a number of other changes regarding employer based business (Non Salary Packaging) that come into effect as well.

 

The FBT year also heralds a new enhancement for JBS Salary Packaging as we are moving our systems to online. This means you will be able to have access to your balances, activity statements and the opportunity to calculate the benefits you can receive by changing the way of adding items such as mobile phones, internet, purchases of IPADS, notebooks and computers to your salary sacrifice arrangements.

 

We are excited to have this ability as it will assist in our clients being better informed and to have real time access to what is happening with their Salary Packaging Account.

 

If you have not sent through your Odometer Reading please email belkins@jbssalarypackaging.com.au to complete ASAP.

JBS Salary PackagingFY17 FBT Year Has Ended

Importance of Comprehensive Insurance

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When packaging a car, you’ll automatically be given full comprehensive motor vehicle insurance, but have you ever questioned why?

All banks who lend you money as a Novated Lease require you to have comprehensive insurance. The main reason is that should you have an accident or your car is vandalised and the vehicle is written off or if your car gets stolen, the financier is assured of receiving the majority, if not all of the funds, back that they have lent you.

The top level of insurance can protect you from the significant costs and inconveniences should an accident occur.  However you will need to be careful when considering what kind of insurance policy is best for you.  There are numerous providers with a range of different policies, not all of them provide adequate cover.

Policy Types

The different types of policies to choose from are:

–  Compulsory Third Party (CTP) insurance is required in Australia and is incorporated into your Vehicle Registration only covers for personal injuries caused due to an accident involving your vehicle. It does not cover for any damage to the vehicle.

–  Third Party Property covers for damage to other people’s property and legal costs, but does not cover damage to your own vehicle.

–  Third Party Fire and Theft cover for damage to other people’s property and legal costs, but does not cover damage to your own vehicle in addition to covering your vehicle for, as it states, fire and theft.

–  Comprehensive policies cover for the repair or replacement of your vehicle for events including theft, collision, fire, malicious damage and weather-related damage, such as hail. This is the required level if you have a novated lease for your car.

Useful tips when looking for the right car insurance policy:

–  Vehicle Details – ensure the vehicle details on the policy are identical to the vehicle you are insuring! Pay close attention to any additional or standard accessories the vehicle came with when purchased i.e. side skirts, full size spare wheel, tow bar kit, reversing camera, bull bar, leather interior, premium sound, etc.

–  Storage – be 100% clear on how the vehicle is stored overnight or during the day (i.e. garaged, carport, under cover in secure parking, in driveway, on the street etc.) as it is an important factor to the insurers consideration of your risk and premium loading/discount.

–  Repairer Options– Choice of repairer means that you can have the convenience of choosing the repairer you want, so you have confidence in the quality of the repair work. The repairer may also be closer to your home or work. Some insurers will have their own approved repairers that they use and can guarantee the works and they try to have a number of repairers so that there is one close to you. In addition to either option of repairers, some insurers will require your car to be taken to an assessment center for their own mechanics to assess the damage and approve a level of funds for the repairs. All these should have a bearing on your choice of insurer.

–  Excess Levels – The excess is the amount you have to pay at claim time. A lower excess amount, generally equates to a high premium and vice versa – higher excess results in a lower ongoing premium. You must choose if you are comfortable paying more at claim, with the idea that you don’t believe you will need to claim (of course, you are an excellent driver), or if you pay a lower excess at claim as you might be prone to an accident or two.

–  Claims Service/ Process – Although no one actually wants to believe that they will need to claim, there may be an instance where you need to and you want to make sure that it’s an easy, straight forward process. You can find a heap of reviews on the internet of people’s experiences with insurance companies and you should read a few before settling on your insurer. You could also use a broker, as it removes the hassle and headaches that come with car insurance claims, and ensures that if there is a problem with your claim you have insurance professionals/ experts working for you to get the matter resolved.

If you follow these tips they can help you keep your premiums reasonable for the cover the fits your requirements.

JBS Salary Packaging along with AustBrokers Countrywide as its Insurance specialists, researches the insurance industry for the best possible deal to meet your needs and requirements.

At JBS Salary Packaging, we understand the importance of protecting your 2nd most valuable asset.

If you would like to review any of your motor vehicle insurances, please contact JBS Salary Packaging on 03 8677 0677 or email us here.

JBS Salary PackagingImportance of Comprehensive Insurance

Preparing your car for holiday driving

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Christmas is always a busy time of the year and many of us enjoy a holiday even if only for a weekend. There are some important checks that you should do before heading off on your break to ensure the safety of your family.

car–  Check under the bonnet and top up everything as needed: power steering fluid, windscreen washer fluid, engine oil, transmission fluid, brake fluid, radiator coolant, etc. If you don’t know how to do this, might be best to drop past a service centre for a quick fill
–  Make sure your windscreen wiper blades work well, leaving no streaks on the glass. Replace them if unsure. You can buy windscreen wiper at any automotive store and they will have a manual to tell you which ones to purchase for your particular car’s make and model
–  Check on the car battery for corrosion, and cleanliness
–  Check that all lights are all working – dashboard, turn signals, headlamps, high beams, hazard lights, etc
–  If towing, check the electrical connectors and make sure that all lights and brakes on the vehicle that you will be towing are working well
–  Make sure all of your tyres are wearing well and that they are pumped up to the manufacturer’s tyre pressure level. This includes any spare tyres
–  If you have child seats, check that they secured properly and cleaned. Seats may wiggle lose over time so it’s always a good idea to check them
–  Get your car serviced and checked by an authorised service centre a few weeks before you head off. It’s always best to get a professionals opinion and your car is no different
–  Many forget but wash your car before heading off. This will ensure all windows are clean and clear giving you the best visibility for driving
–  Ensure you have emergency gear in your car such as road reflectors, torches and water…just in case

We would love to see your holiday snaps, especially with your packaged car. Let’s see how far our cars travel this year.

JBS Salary PackagingPreparing your car for holiday driving

End Of An Era

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In October, we saw the very last Australian-made Ford roll off the assembly line at the Broadmeadows plant. What a sombre day for workers but it should also be for all Australians!

 

The Geelong factory opened in 1925, building both engines and vehicles but changed to engine and metal stamping in 1959 when the Broadmeadows plant was opened. In 1994, the NSW plant closed seeing the production of the locally made Ford Capri cease. In 2007, Ford announced that they would be closing their Geelong plant in 2010, however later cancelled the decision and instead upgraded the plant so that the engines produced would meet strict European standards.

 

In 2013, Ford again announced it would close its Australian manufacturing operations in 2016 and this time they meant it, after suffering a $141 million loss over the previous financial year. This would also mean the loss of jobs for around 1,200 workers.

 

In a nice gesture to both Geelong and Broadmeadows communities, the official homes of Ford, they will be auctioning the last saleable cars built at the plants with the proceeds being donated to local schools in both areas. The final vehicles built will not be sold but rather will be put on display.

 

carDick Johnson, three-time Bathhurst winner and five-time Australian Touring Car champion has expressed his disappointment at the closure of Ford, and other Australian car manufacturers. Talking at Bathurst this year he was quoted as saying “For today to be qualifying for the Bathurst 1000, and to be the last Falcon to roll off the production line, it’s a date we won’t forget that’s for sure, albeit very sad.”

 

While there is $66 million provided in support for sacked workers, many are still struggling to find alternative employment. This is due to the need for their very specific skill sets in metal casting being almost redundant given that the majority of the automotive industry in Australia is closing, with Holden and Toyota also closing down vehicle production in 2017.

 

So it’s anyone’s guess what will happen from here in relation to car prices. Some are saying that with no manufacturing in Australia the prices will increase with the expense of importing and others believe that it will open the Australian market up to further competition and our exchange rate will also play into it. Either way, it’s sad to think that our kids wont have the option to buy an Australian built car but rather might be zipping round in a cheap import.

JBS Salary PackagingEnd Of An Era

Luxury Car Tax on your Vehicle

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Luxury Car Tax (LCT) is a tax levied on the sale of new or near new vehicles which meet a set of ‘luxury car’ criteria. It was introduced in 2000 in conjunction with the removal of sales tax and the introduction of the Goods and Services Tax (GST).

Want to learn more about the Luxury Car Tax?
1.    Luxury car tax (LCT) is a tax on cars with a GST-inclusive value above the LCT threshold

Luxury car tax (LCT) thresholds

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2.    LCT is calculated at the rate of 33% on the amount above the luxury car threshold and depending on the fuel efficiency of the vehicle
3.    LCT is paid by businesses and individuals who sell or import luxury cars
4.    LCT applies to the sales of cars that are two years old or less

What makes a ‘Luxury Car?
When you think of the words Luxury Car, many think Porshe or Ferrari or maybe even Mercedes but the actual answer for tax purposes is quite different. Contrary to perception, Luxury Car Tax impacts Toyota more than brands such as Audi, BMW, Mercedes-Benz and Porsche because Toyota sells more models above the $64,132 threshold than do the German brands.

jbsspLuxury Cars for the sake of the LCT, are motor vehicles that are not a motorcycle and are designed to carry a load of less than two tonnes and fewer than nine individuals.

How to Calculate the Luxury Car Tax
The formula to calculate the luxury car tax is as follows:

(LCT value – LCT threshold) x 10/11 x 33%

The Luxury Car Tax Value of the vehicle includes:  
1.    GST and any customs duty (this excludes stamp duty, registration and transfer fees)
2.    Dealer delivery charges
3.    Standard and statutory warranties (not extended warranties)
4.    Additional items like accessories and modifications, like reversing sensors, roof racks etc
5.    Fleet rebates run-out model incentives or other incentives for provided to entice the purchase

To understand how this works, let’s look at the following case study:

Johnson Motors sells high end luxury cars. They sell Terry a vehicle for $88,000 including GST (not fuel efficient). The LCT value of the car is more than the Luxury Car Tax threshold of $64,132 so Johnson Motors has to fork out $7,160 in LCT on the sale of the car.
($88,000 – $64,132) x 10/11 x 33% = $7,160

Like many car dealers, Johnson’s passes on this cost to Terry and he must pay $95,160 for his car.

If Terry were to sell the car again within the first two years, he may be liable for additional LCT. It is levied on the sale however is reduced by all previous tax payments made on the vehicle so effectively, he is only liable if he sells the car for a profit (good luck!).
The tax is expected to earn the government about $570 million this financial year alone. However, the government flagged in its budget in May that Australia’s appetite for luxury cars meant it would reap a $240 million bonus from the tax over the next four years.

If you’re concerned how the Luxury Car Tax may affect your new purchase or want to look at your options of purchasing a luxury car through salary packaging to reduce some overall tax, give the team at JBS Salary Packaging a call to discuss.

JBS Salary PackagingLuxury Car Tax on your Vehicle

Benefits of having a dash cam

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Dash Cams have become quite popular in recent years, the small and relatively inexpensive device could end up saving you a fortune. Below we have listed some of the benefits that fitting a dash cam could provide to you and your family:

You have evidence of a car accident
dash-camThe main reason millions of car drivers worldwide invest into a dash cam is to provide evidence in the event of an accident. With insurance premiums increasing when you’re at fault and tempers of drivers increasing, it is unfortunate that an accident can turn into a blame game. Having a dash cam provides that undisputable evidence of the facts. Many dash cams start recording as soon as you start your car’s engine so it doesn’t miss a thing.

Perfect to check up on the kids driving
When the kids have just passed their Ps and are driving for the first time on their own it can be nerve racking for the parents. While you may have put the time and effort into teaching them the road rules, road etiquette and even safety measures, it is never an easy time to hand the keys to the kids. The dash cam records the journey and can be reviewed to ensure safe driving behaviour is being carried out (and the keys revoked if it is not).

Prevent insurance fraud
This occurs when some unscrupulous drivers purposely cause car accidents just to put the blame on the other party in order to extort money from the victim. While this is more prevalent in countries like Russia or some Asian regions, it is a consideration nowadays in Australia too. Many think that they are not hurting anyone as big insurance companies payout but ultimately it puts all insurance premiums up for all road users. Check out some clips here

Protection when parked
Some dash cams have sophisticated sensors that will activate the recording so that if you’re parked and your car gets a hefty bump, like if another car reverses into your parked car, it would start recording with the hope that it would capture the number plate to provide evidence for the police to follow up.  I mean, everyone hates it when they go shopping and come back to a scratch, mark or dent on their car and no note with contact details of the offender. I once had a note on my car but unfortunately it was one of those “sorry I hit your car. Someone saw me so I’m writing this note so they think I’m leaving my details” notes. I wish I had a dash cam for that one!

Record your trip
Like any holiday, you can record footage of your travels. It can be a great investment if you’re a frequent traveller who wants to convert their road trips into a great experience and a memory you will cherish over the years. To get some ideas click here

Capture some cool stuff
In Russia, numerous dash cams caught the moment that a meteorite crashed. A compilation video has had almost 40 million views on youtube. You could be the next YouTube sensation.

JBS Salary PackagingBenefits of having a dash cam

Changes in the blink of an eye

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Each year trends appear in the technology industry with new improvements happening almost daily but as you can salary package a portable device such as an iPad, tablet or laptop annually without any Fringe benefits Tax (FBT) you can afford to keep up to date. Some of the new features are fads and will fade as quickly as they arrived however some features will become standard across the board on laptops and other computer devices but how do you know what is a keeper and what you won’t need in your next purchase?

 

tabletThere is generally an annual tech show that occurs in January each year in Australia and they also show around the world. At these conventions, computer producers try to one-up each other with the latest and greatest. We’ll discuss a few of the new and improved features available on current laptop, computer, handheld devices, etc.

 

Having a convertible design seems to be the ‘top of the charts’ must have – giving you flexibility to have a laptop for your desk at work and converting to a convenient and small tablet while on your flight to Sydney. Many suppliers are now integrating convertible functionality into their designs but are not skimping on capability or power to do so.

 

New connections are big each year, with the introduction of UBS-C in 2016. The idea of new connection ports is to fasten up the transfer rate (data and power) and again improve performance. These may become the norm relatively soon, with Macbook, Dell, HP and Lenovo all including it in their 2016 releases so just watch out for this one.

 

OLED – have you heard of it yet? It’s all about screen resolution and it’s been in some of our mobile phones for a little while now (Samsung Galaxy series) but only now are we starting to see it in laptops and TVs. So what is it? OLED, or organic light-emitting diodes, works by putting electricity through certain materials that glow specific colours. You effectively get a clearer and sharper colour but also as individual pixels shut down if there’s no colour, you get a blacker black, providing a significantly better watching experience. The application of OLED is endless and allows for a thinner screen and can even be made flexible. This is definitely one to watch out.

 

Intel, the main guys that produce PC chips, has again upgraded their processors to a new generation. Officially called Intel 6th Generation Core series (Code-named Skylake), these new CPUs are not only quite a bit faster than the one in your three-year-old laptop, but also promise significantly longer battery life.

 

Like every other year, there’s been significant technology change so it might be time for an upgrade. With the benefit of a FBT free purchase, maybe you should give us a call to see if you can get yourself a new laptop for a nice price while saving on tax. If you’re considering an iPad or other hand held device, you could even look at bundling it with your mobile phone – why not save tax on all your everyday items. Give us a call and we can see what other things can be packaged for you.

JBS Salary PackagingChanges in the blink of an eye

Second Hand Cars

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Novated leases aren’t just for new cars. If you’re thinking of getting a second hand car you can package it as well. The only real rule when it comes to including a second hand car in your salary package is that it should not be older than eight (8) years old at the completion of the lease. There is no restriction on where you can purchase your car, giving you the freedom to purchase from a private seller or a car yard.Cars

 

If you are considering a second hand car purchase for your package, here are a few tips to think about:

 

Time
When buying second hand, it may take you longer to find the right one or you may have to compromise. Write a list of things you want in your car and divide them into ‘must haves’ and ‘would likes’. This way, you won’t be swayed by a lower price, quick sale or other salesman tactics.

 

Research
Do your research – this means, check reviews and google search the make and model of the car. See if there are repeated reports that it’s a lemon and maybe steer clear. In addition to general research on the vehicle type, do proper research on the actual car you’re looking to buy. Ask to see the service history book, do a check through your states registry websites on the details of the car, including VIN or Engine numbers or you may want to pay someone to do a proper full history on your car from websites like vehicle history.

 

Mechanical Checks
Make sure you get a full mechanical check of your car, and by someone you organise. There are mobile services that will come to you or alternatively get your personal mechanic to give it the once over. While a second hand car might be cheaper initially, it could end up being more expensive in the long run.

 

Include additional spending in package
One of the benefits of buying new is the limited need for major repairs. Make sure you take the history and age of the car into account when determining your additional spends on the car for your packaging purposes. For example, you may need to increase your servicing costs or add a provision for new tyres. When buying second hand, you need to be more diligent with the process. There are generally no warranties or guarantees and you could end up paying more than you would for a new car if you make a mistake. But if you do your research and get it right, you can enjoy your car and still get a tax saving along the way.

JBS Salary PackagingSecond Hand Cars