Novated Lease Question

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Question

Assalam Alaikum
I would like to ask the following questions.

1) Is Novated lease permitted in Islam?

2) How about the salary sacrifice? Using salary sacrifice to contribute extra amount towards your superannuation

Jazakallah

 

Answer

وعليكم السلام ورحمة الله وبركاته

1. The Novated Lease arrangement is still under consideration and will be advised once an outcome has been reached.

2. Salary Sacrifice / Salary Packaging / Total Remuneration Packaging is a pre-tax arrangement between the employer and employee where the employee agrees to forgo a future entitlement in return of benefits of a similar value.

This will be permissible provided
the benefit is :

1. Shari’ah complaint.
2. Clearly agreed upon between employer and employee.

Salary Sacrificed super contributions under an agreed upon arrangement between employer and employee is considered an ‘employer contribution‘ and is a permissible Salary Sacrificed arrangement.

And Allah Ta’ala Knows Best.

Answered By:

Shabir Moosa
05/07/20

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