Item 5 in the fee calculation “The total amount of rental payable by consumers under consumer leases submitted by the licensee to lessors in the preceding financial year which have resulted in a consumer lease being made” for Annual Compliance certificate fee assume to include loan contracts, or refer to leases only?
Under the National Credit Code (“the Code”), a “consumer lease” is a contract for the hire of goods, by a natural person or strata corporation, with no right or obligation to purchase the goods.
Loan contracts are credit and are therefore counted as a different component of the annual compliance certificate fee; Item 1, “the total amount of credit advanced by you in the preceding financial year”.
To determine whether your business offers leases or credit, you must consider the terms of your customer contract. More specifically, consider whether there is a right or obligation to purchase on the part of the customer. If the answer is yes, it is a credit contract and will come under Item 1. If the answer is no, it is a lease agreement and will come under Item 5.
However please be advised that the Code applies to fixed term leases only. Indefinite term leases are exempt from regulation under the Code.
Please feel free to contact our licensing team if you require further information.