As the Working Year Winds Down, It's Time to Plan for 2025: Why Now Is the Perfect Opportunity to Rethink Employee Benefits
With just six weeks left in the working year, businesses are turning their focus from wrapping up 2024 to laying the groundwork for a successful 2025. As competition for top talent continues to be a key challenge, now is the perfect time to re-evaluate and refresh the benefits you offer your employees.
Workforce expectations have shifted significantly, driven by post-pandemic values, rising living costs, and an increasing emphasis on sustainability. Forward-thinking employers are realizing that a one-size-fits-all approach to benefits is no longer sufficient. Instead, strategic benefits can be a game-changer, both in attracting new hires and retaining existing talent. One standout option that has gained popularity, especially in Australia, is the inclusion of novated leasing — particularly with the rise of EV’s and the introduction of significant government incentives.
Why Now Is the Time to Rethink Benefits
The final stretch of the working year is an ideal moment for business leaders to reflect on what's worked well and identify areas for improvement. After all, your team’s satisfaction and well-being are critical to your company's overall performance. Offering innovative and flexible benefits, like novated leasing, can give your organization a competitive edge.
Novated Leasing: A Win-Win for Employers and Employees
Novated leasing has become one of the most attractive benefits that companies can offer, especially with the increased interest in sustainable transportation. For those unfamiliar, novated leasing allows an employee to finance a vehicle through their employer, with lease payments and running costs made from their pre-tax salary. This can significantly reduce an employee’s taxable income, providing considerable financial savings.
What makes novated leasing particularly appealing right now is the introduction of the Electric Car Discount Bill. This bill removes fringe benefits tax (FBT) on eligible EVs under certain price thresholds, making it even more cost-effective for employees to transition to electric vehicles. The incentive dramatically lowers the overall cost of owning an EV, encouraging sustainability while making environmentally friendly commuting more accessible to employees.
The Huge Benefits of Novated Leasing for Employers
Offering novated leasing, especially with the EV discount, provides substantial advantages for employers:
- Employee Attraction and Retention: In a competitive job market, perks like novated leasing can differentiate your company from those that do not offer it. Employees increasingly value benefits that contribute to their financial wellness, and the potential savings through novated leasing are hard to overlook.
- No FBT Liability for Employers – completely managed by Alliance Leasing: Employers are protected from fringe benefits tax (FBT) on novated leases when the employee contribution method is being used. This approach involves employees making post-tax contributions toward the vehicle's running costs, effectively offsetting the FBT liability to the employer. Additionally, applicable electric vehicles are completely exempt from FBT, offering even greater savings and benefits under a novated lease arrangement.
- Sustainability Initiatives: As environmental, social, and governance commitments become more critical for businesses, the push towards sustainability is a key selling point. Supporting employees' transition to electric vehicles can be part of a broader corporate social responsibility strategy, boosting your brand's reputation and aligning with values that are increasingly important to both employees and consumers.
- Employee Well-being and Financial Relief: Novated leasing offers staff members the convenience of a bundled payment that covers vehicle costs, insurance, and maintenance. With rising living expenses, these savings can ease financial stress, contributing to overall employee well-being.
Why the Popularity Is Surging
The combination of government incentives, a growing awareness of climate change, and increased EV availability has supercharged interest in novated leasing. As more models enter the Australian market with better range and affordability, the demand for EVs is rapidly expanding. By offering novated leasing and leveraging these trends, your company can be seen as both forward-thinking and employee-focused.
Planning for 2025
As you take stock of your 2024 successes and set goals for the year ahead, consider how you can make your benefits package as attractive as possible. Novated leasing isn’t just a financial perk — it’s a forward-looking strategy that aligns with employee priorities and corporate responsibility. With the significant savings tied to the Electric Vehicle Discount Bill, the time has never been better to implement this benefit.
As you finalize plans for 2025, don't miss the chance to stand out in a tight labor market. Offering novated leasing, especially for EVs, can be a meaningful, high-impact addition to your benefits portfolio, setting your business apart and setting up your workforce for a future that’s both financially and environmentally secure.
