How the EV exemption works
A novated lease bundles your car, its running costs and finance into one payment taken from your salary. For an eligible EV, that payment comes out before tax, and there is no fringe benefits tax to offset it. That is what makes electric so effective.
An honest note: FBT exempt means no fringe benefits tax is payable, but the benefit is still reported on your income statement. That reported amount can affect income-tested things like HECS or HELP repayments, the Medicare levy surcharge, and family payments. Our calculator and team will always show you the full picture.
What is included
- The car itself, financed at a rate we show plainly
- Electricity or charging costs
- Registration and CTP
- Comprehensive insurance
- Servicing, tyres and roadside
Everything above is packaged into one pre-tax figure, so your take-home pay does the work.
Which EVs are eligible
To be FBT exempt, an electric car needs a drive-away price at or under the luxury car tax threshold for fuel-efficient vehicles, which is $91,387 for 2024-25. That covers the large majority of EVs Australians actually buy, from small hatches to mid-size SUVs.
Put your car into the calculator and it will tell you instantly whether it sits under the threshold.
Where we are different
Most providers bury their commission inside your interest rate, so you never see what the finance really costs. We charge one flat $1,500 fee and show you the true effective rate. On a big-ticket EV, that transparency is worth real money.
Common questions
Which electric cars are FBT exempt?
Battery electric and hydrogen fuel-cell vehicles first held and used on or after 1 July 2022, with a drive-away price at or under the luxury car tax threshold for fuel-efficient vehicles ($91,387 for 2024-25). Most popular EVs sit under this.
How much can I actually save on an EV?
Because the whole package comes out of pre-tax salary and there is no FBT to pay, EV drivers often save more than on a petrol car. The exact figure depends on your salary, the car and your running costs. The calculator gives you your real number in a minute.
Do plug-in hybrids (PHEVs) qualify?
They did, but the PHEV FBT exemption ended on 1 April 2025. A PHEV already under an eligible arrangement before that date can keep the exemption under transitional rules. New PHEV arrangements no longer qualify. Battery electric vehicles are unaffected.
Is the saving really tax-free?
There is no FBT payable on an eligible EV, and you pay for it from pre-tax salary. The benefit is still reported on your income statement, so it can affect income-tested amounts like HECS. We show you that up front rather than burying it.