What is a Novated Lease? | Toyota Fleet Management

How does it work?

Lease set up

Lease set up

Your employee chooses a car and a novated lease arrangement is set up between the employee, employer and TFM.

Payments made

Payments made

An employer makes payments to TFM from the employee's salary.

Employee saves

Employee saves

Your employee gets the car they want, saving on tax and running costs, including car price, fuel, maintenance and tyre purchases.

Cashless motoring

Your employee enjoys the convenience of cashless motoring.

Discover More

How to get a novated lease

How to Get a Novated Lease

Financial Hardship: Covid 19

Toyota Finance Hardship : Covid-19

Novated Lease Calculator

Novated Lease Calculator

Claim form

Any Car

Choose the car that suits your lifestyle, any make or model.

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Tax-effective financing through pre and post-tax salary deductions.

Interest Rates Icon

Interest rates

We believe we can offer competitive interest rates with transparency across all rates, fees and charges.

Buying Power Icon

Buying power

Take advantage of TFM’s buying power on the cost of car.

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Servicing & maintenance

Discounts on fuel and negotiated parts and labour rates for maintenance, servicing and tyres.

Fuel Bowser Icon


Further savings with the TFM fuel card.

Further Reading

How novated Lease works

How Novated Lease Works

Novated Lease Enquiry

Benefits of a Novated Lease

Business Novated Lease

Business Novated Lease

Novated Lease Employer Information

Novated Lease Employer Information

Novated Lease FAQS

A novated lease is where your car lease is paid for by your employer through a combination of pre-tax and post-tax salary deductions. With novated leasing, you can drive the car of your choice without compromising on lifestyle.

At the end of your lease there are two options available to you: extend your contract or purchase your car. TFM will contact you before your lease finishes to discuss these options with you. It is easy to get a new car on another lease and our dedicated team of specialists are here to help you every step of the way.

Yes, you can consider a sale and leaseback on a vehicle that you currently own. The financier can buy your car from you at current market value and lease it back to you with all the benefits of a novated lease.

You must not, without TFM’s consent:

(a) make any alteration or addition to the car;

(b) install anything on or in the car.

You must ensure that only an Authorised Service Centre makes any modifications to the vehicle.

No, you must not sell, lend, or otherwise part with the possession of the leased vehicle. Have a read of our Terms and Conditions for more information.

The purchase of stamp duty is included in the upfront costs of the novated lease. The full list of inclusions will be available to you in your Novation Agreement document.

A residual value is the value of the car at the end of the lease term. The residual value is agreed when you take out a novated lease and is used to calculate the monthly lease payment. When you choose your car, TFM will recommend a residual value that takes into consideration the make, model and estimated usage. This value is incorporated into your novated finance lease.

When it comes to mechanical repairs, we recommend you use our pre-authorisation and payment service. Just let your repairer know your car is managed by TFM and they’ll call us to authorise the work before they start. You can buy fuel, oil or carwash services with a TFM Motorpass Fuel Card, accepted at most petrol stations across Australia. See the full list of included running costs here:

Ask your employer about their salary packaging/car policy to see if you are eligible to package a vehicle via novated lease. Then, check if your employer has an agreement with us. If not, no problem, we can advise you on how to get one in place.

Let us know straight away if you leave your current employer. If your new employer is an existing TFM customer or are willing to become one, you can maintain all existing lease services. We will simply transfer the lease to your new employer and they will need to sign the novation agreement. If your new employer does not want to enter into a novation agreement, your services, including your TFM Fuel Card and car running costs, will cease and car payment obligations transfer immediately from your employer to you. You will be required to continue the lease payments from your after-tax income. Alternatively, you may pay out the lease.


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