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Step 4: Sign the lease and novation deed
The legal documents that create your three-party novated lease arrangement.
Documents you'll sign
Lease agreement: between you and the finance company. Sets out vehicle details, lease term, interest rate, residual value, and your obligations.
Deed of novation: between you, your employer, and the finance company. Transfers your payment obligations to your employer for the duration of your employment.
Direct debit authority: authorises your employer to deduct lease payments from your salary and remit to the financier.
What to check before signing
Read these details carefully — they're binding for the lease term:
- Residual value matches ATO minimums for your lease term
- Pre-tax vs post-tax deduction split is clearly stated
- Fully maintained inclusions are listed (fuel, insurance, servicing, etc.)
- End-of-lease options are documented (refinance, buyout, trade-in)
- Interest rate and total cost over the lease term
- Early termination fees and conditions
Employer sign-off
Your employer must also sign the novation deed and direct debit authority. Most providers handle this directly with your HR/payroll team. Allow 1–2 weeks for internal employer processing.
Key takeaways
- Three documents: lease, novation deed, direct debit
- Verify residual, ECM split, and inclusions before signing
- Allow 1–2 weeks for employer sign-off
This content is for educational purposes only and does not constitute financial or tax advice. Verify details with the ATO, your employer, and your novated lease provider.