EV Novated Lease Australia | Save $1000s with FBT-Exempt Salary Packaging

What is an EV Novated Lease?

An EV novated lease is the smartest way for Australian employees to get an electric vehicle. It's a three-way salary packaging arrangement where your employer deducts lease payments from your pre-tax salary, dramatically reducing your taxable income and putting more money in your pocket.

With the Federal Government's FBT exemption for electric vehicles under $91,387, you can now save significantly more than traditional vehicle novated leases. The average employee saves $5,000-$15,000 per year depending on their income and vehicle choice.

💡 Real Example: An employee earning $90,000/year leasing a $60,000 Tesla Model 3 could save approximately $10,500 per year in tax compared to buying the same car with after-tax dollars.

Why Choose an EV Novated Lease?

Massive Tax Savings: Pay from pre-tax income, reducing your taxable income by $15,000-$30,000+ per year
FBT-Exempt: No Fringe Benefits Tax on eligible EVs (vehicles under $91,387)
All Costs Bundled: Electricity, insurance, registration, servicing included in one pre-tax payment
GST Savings: Your employer claims GST on the vehicle and running costs
Fixed Budgeting: One predictable payment covers everything - no surprise bills
Upgrade Flexibility: Drive a new EV every few years without the depreciation hit

How It Works

Choose Your Electric Vehicle

Select any EV under $91,387 to qualify for FBT exemption. Popular choices include Tesla Model 3/Y, BYD Atto 3, MG ZS EV, Hyundai Ioniq 5, and more.

Get a Quote & Calculate Savings

We'll show you exactly how much you'll save in tax based on your salary. Most people are shocked by how much they keep in their pocket.

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Employer Agreement

Your employer agrees to the novated lease arrangement. We handle all the paperwork and make it easy for your HR/payroll team. Most employers readily agree as there's minimal admin and no cost to them.

Drive Away & Start Saving

Lease payments are deducted from your pre-tax salary each pay period. All running costs (electricity, insurance, rego, servicing) are bundled into this payment. You immediately see the tax savings in your pay packet.

FBT Exemption Explained

The Australian Government offers a complete Fringe Benefits Tax (FBT) exemption for electric vehicles valued below the luxury car tax threshold for fuel-efficient vehicles, which is $91,387 for the 2024-25 financial year.

This means:

Your employer pays zero FBT on the benefit of providing you the vehicle
You don't need to make post-tax "employee contributions" to reduce FBT
The full lease amount comes from your pre-tax salary, maximising savings
Personal use of the vehicle is fully covered under the exemption

Eligible vehicles include: Battery electric vehicles (BEVs) and hydrogen fuel cell vehicles. Plug-in hybrids (PHEVs) do not qualify for the FBT exemption.

What's Included in Your Novated Lease Package?

Everything is bundled into one convenient pre-tax payment:

Vehicle Lease: The cost of the EV spread over 1-5 years
Electricity/Charging: Home charging and public charging costs
Comprehensive Insurance: Full cover for your EV
Registration & CTP: Annual rego and compulsory third party insurance
Servicing & Maintenance: All scheduled services (EVs need very little maintenance)
Tyres: Replacement tyres over the lease term
Roadside Assistance: Peace of mind if you break down
Fleet Management: Administration of the lease and cost tracking

The result? One simple pre-tax payment that covers absolutely everything. No more juggling multiple bills or surprise expenses.

How Much Can You Save?

Savings depend on your salary and the vehicle you choose. Here are real examples:

Example 1: $90,000 Salary + $60,000 Tesla Model 3

Annual lease + running costs: $18,000
Tax saved (37% tax bracket): $6,660
GST savings: $1,636
Total annual saving: $8,296
Effective cost after tax benefits: $9,704/year instead of $18,000

Example 2: $120,000 Salary + $75,000 Tesla Model Y

Annual lease + running costs: $22,500
Tax saved (39% tax bracket): $8,775
GST savings: $2,045
Total annual saving: $10,820
Effective cost after tax benefits: $11,680/year instead of $22,500

These are indicative examples. Your actual savings will depend on your personal tax situation, the vehicle chosen, and running costs. We provide detailed calculations tailored to your circumstances.

Ready to See Your Personal Savings?

Get a detailed quote showing exactly how much you'll save based on your salary and vehicle choice.

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Eligibility Requirements

To qualify for an EV novated lease, you need:

Permanent Employment: Full-time or part-time employees (not contractors or sole traders)
Employer Agreement: Your employer must agree to participate (most do as there's no cost to them)
Minimum Salary: Generally $50,000+ gross annual income
Eligible Vehicle: Battery electric vehicle valued under $91,387
Credit Assessment: Standard credit checks apply

What Happens If I Change Jobs?

This is a common concern, but it's easily managed:

Option 1 - Transfer: Most new employers will agree to continue the novated lease. We handle the paperwork to transfer it seamlessly.
Option 2 - Continue Personally: You can take over the lease and make payments from your after-tax income until you secure employment with a participating employer.
Option 3 - Early Payout: You can pay out the remaining lease amount and own the vehicle outright.

In our experience, over 80% of modern employers support novated leasing as it's a cost-neutral employee benefit that improves retention.

Popular EVs for Novated Leasing

These vehicles are under the $91,387 FBT threshold and perfect for novated leasing:

Tesla Model 3: Australia's best-selling EV - from $55,000
Tesla Model Y: Popular SUV with great range - from $65,000
BYD Atto 3: Affordable family SUV - from $44,000
MG ZS EV: Budget-friendly option - from $42,000
Hyundai Ioniq 5: Stylish with fast charging - from $67,000
Polestar 2: Premium Swedish EV - from $69,000
Kia EV6: Award-winning crossover - from $67,000

Frequently Asked Questions

What is an EV novated lease?

An EV novated lease is a three-way agreement between you, your employer, and a finance company. Your employer deducts lease payments from your pre-tax salary, reducing your taxable income. For electric vehicles valued under $91,387, the lease is FBT-exempt, providing significant tax savings.

How much can I save with an EV novated lease?

Savings vary based on your income and tax rate, but most employees save $5,000-$15,000 per year on a $60,000 EV. This includes reduced income tax and FBT exemption benefits. Higher income earners typically see greater savings due to higher marginal tax rates.

What is the $91,387 FBT exemption threshold?

Electric vehicles with a retail price below the luxury car tax threshold for fuel-efficient vehicles ($91,387 for 2024-25) are exempt from Fringe Benefits Tax when provided through a novated lease. This exemption significantly increases the tax savings compared to traditional vehicle novated leases.

What happens if I change jobs?

If you change employers, you have several options: transfer the novated lease to your new employer (if they participate in novated leasing), take over the lease personally and continue payments from after-tax income, or pay out the lease early. Most modern employers support novated leasing, making transfers straightforward.

Are running costs included in an EV novated lease?

Yes, EV novated leases can bundle all running costs into your pre-tax deductions including: electricity/charging, insurance, registration, servicing, tyres, and roadside assistance. This provides a single, tax-effective payment that covers everything, making budgeting simple.

Save $1,000s with an EV Novated Lease