Circular 99-15 provided detailed guidance on novated leases and a standard Deed of Novation of Motor Vehicle Lease. The purpose of this Circular is to provide an updated Deed of Novation, developed by the Crown Solicitor. The revised Deed attached should now be used in any future novation arrangements.

It should be noted that the revised Deed represents a "full novation" rather than a "split-full novation", and agencies should therefore assume responsibility for payment of all running and standing costs for vehicles. These costs should then be charged to the officer's remuneration package together with an amount equal to the FBT and GST costs. This will enable Agencies to claim applicable Income Tax Credits as per the policy contained in Circular 2000-46. Detailed guidelines on novated lease arrangements to replace those provided with Circular 99-15, will be issued in the near future.

In referring to earlier guidelines officers should also have special regard to the importance of yearly reconciliations of actual motor vehicle costs against the estimates charged to an individual's remuneration package. Adjustments to remuneration packages must be made at the end of each year to account for under or overestimates against the actual number of kilometres travelled.

Electronic copies of the standard Deed of Novation are available under Publications, then Travel.

C. Gellatly
Director-General

Issued: Public Sector Management Office
Contact: Mark Burke
Telephone: (02) 9228 3147
EMail: [email protected]
Date: 1 December 2000
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Replaced Deed of Novation in C99-15. A corrected version was posted December 2002.
Current version of the Deed of Novation can be found in our Publication Section look under travel