What is the Residual Value and how is it determined?
The Residual Value (RV) is the amount of money you owe on the vehicle at the end of the finance term, this amount is fixed and is determined at the beginning of the lease. Please note, the RV attracts GST. The RV is usually expressed as a percentage of the “Amount Financed” and represents the amount that remains payable to the financier at the end of the Lease Term. The RV chosen must stay within guidelines determined by the Australian Tax Office and these vary depending on the Lease Term chosen. If the market value of the vehicle is less than the RV, the resultant shortfall will be your responsibility. Likewise, should the market value be more than the RV, the surplus shall be to your benefit.
