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Novating an electric car

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Make the switch to electric!

The transition from combustion engines to electric vehicles is well and truly underway with an ever-growing number of Australian drivers making the switch. Whether you’re looking for environmental benefits or to benefit your back pocket, you’ll find plenty of reasons to be happy about getting an electric car.

Just like a petrol or diesel vehicle, you have the option to pursue a novated lease with an electric vehicle where the cost of the car and it’s running costs are deducted from your pre-tax salary. You can reduce your income tax and gain access to GST savings on the vehicle purchase price, servicing, tyres, and much more!

Why go electric?

1
Reduced running costs
2
Reduced maintenance costs
3
Reduced emissions
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Available EV Incentives
Reduced running costs

EVs are significantly cheaper to run including fuel savings of up to 70%.

The cost of the electricity required to charge an electric vehicle is much lower than the cost to use a petrol or diesel vehicle driving a similar distance. Electricity prices are also less likely to drastically fluctuate overnight.

While the cost to recharge your electric car’s battery will depend on the car’s battery size, your electricity provider and local tariffs, electric vehicles generally work out cheaper than filling up at the bowser.

Reduced maintenance costs

Electric vehicles have lower running costs than internal combustion engine vehicles (ICEVs).

EVs have far fewer moving parts than that of a petrol or diesel vehicle ensuring that servicing is less frequent and overall, much cheaper!

With an EV, you don’t need to replace filters and spark plugs, change oil, or repair the transmission, head gasket or engine.

Reduced emissions

Arguably the biggest incentive for motorists to get behind, electric vehicles offer the potential to significantly reduce greenhouse gas (GHG) emissions and harmful tailpipe emissions into the atmosphere, reducing your carbon footprint.

Pairing an EV with renewable energy, such as solar photovoltaic (PV) and battery storage can further reduce GHG emissions.

Available EV Incentives

The Australian government has implemented various incentives aimed at encouraging the acceptance of electric vehicles (EVs) within the nation. These incentives are in line with several other influences that are fueling the growing adoption of EVs in Australia.

For more information, visit our Federal and State based electric vehicle incentive guide.

Electric Vehicle Incentives

Luxury Car Tax Threshold Increase

From the 1st of July 2023, the federal government will increase its Luxury Car Tax (LCT) thresholds helping many Australians save thousands on the price of a new vehicle.

The LCT threshold for ‘fuel efficient’ vehicles will be raised from $84,916 to $89,332, and the LCT threshold for all other vehicles will increase from $71,849 to $76,950.

Check out our Luxury Car Tax Threshold Increase article to find out more.

Luxury Car Tax Threshold Increase

From the 1st of July 2023, the federal government will increase its Luxury Car Tax (LCT) thresholds helping many Australians save thousands on the price of a new vehicle.

The LCT threshold for ‘fuel efficient’ vehicles will be raised from $84,916 to $89,332, and the LCT threshold for all other vehicles will increase from $71,849 to $76,950.

Check out our Luxury Car Tax Threshold Increase article to find out more.

Electric Car Discount FBT Exemption

Designed to incentivise the uptake on zero and low-emissions vehicles in Australia and reduce transport emissions, the Electric Car Discount Bill removes import tariffs and Fringe Benefits Tax (FBT) effective from the 1st of July 2022.

The FBT exemption applies to electric vehicles where the following criteria are met:

  • The car is a zero or low-emissions vehicle
  • The first time the car is both held and used is on or after 1 July 2022
  • The car is used by a current employee or their associates (such as family members)
  • Luxury Car Tax (LCT) has never been payable on the importation or sale of the car

Benefits provided under a salary packaging arrangement (including those procured under a novated lease) are included in the exemption.

Check out our Electric Vehicle FBT Exemption guide to find out more.

Electric Car Discount FBT Exemption

Designed to incentivise the uptake on zero and low-emissions vehicles in Australia and reduce transport emissions, the Electric Car Discount Bill removes import tariffs and Fringe Benefits Tax (FBT) effective from the 1st of July 2022.

The FBT exemption applies to electric vehicles where the following criteria are met:

  • The car is a zero or low-emissions vehicle
  • The first time the car is both held and used is on or after 1 July 2022
  • The car is used by a current employee or their associates (such as family members)
  • Luxury Car Tax (LCT) has never been payable on the importation or sale of the car

Benefits provided under a salary packaging arrangement (including those procured under a novated lease) are included in the exemption.

Check out our Electric Vehicle FBT Exemption guide to find out more.

EV Frequently Asked Questions

Why would I buy an electric vehicle if they’re so expensive?

The upfront costs of an electric vehicle are currently more expensive than conventional vehicles, however powering and maintaining your EV is much cheaper. And, if you’re considering purchasing an electric vehicle through a Fleetcare Novated Lease arrangement, not only will you pay no GST on the purchase price, but you’ll also be eligible for the FBT exemption through the Electric Car Discount Bill.

How often will I need to charge my electric vehicle?

The average Australian driver travels 38 kilometres per day. Most electric vehicles can travel 480 kilometres (some more!) from a single charge, so most drivers can expect to go at least 10 days before a recharge is required.

Where can I charge my vehicle?

Unlike petrol or diesel cars, electric vehicles can be charged at home or anywhere with access to electricity.

If you need to charge your vehicle outside of your home, there are plenty of public charging stations throughout the country. The Electric Vehicle Council provides a map listing all current charging stations in Australia.

How long does it take to charge an electric vehicle?

Charging times vary depending on the charging method you are using and your vehicle’s battery capacity.

If you are charging your vehicle at home, it can take anywhere between six to eight hours to fully charge. This means you can easily charge your car overnight.

Public fast chargers will have you fully charged within three hours, and Ultra-rapid chargers can add 300 kilometres of driving range in just ten minutes. An ever-expanding network of public charging infrastructure is being installed across Australia, so you have plenty of options available to choose from.

What manufacturers provide electric vehicles?

Electric vehicles are currently available from the following manufacturers with many more expected to bring EVs into the market soon:

  • Tesla
  • Mini
  • Kia
  • Hyundai
  • Volvo
  • Polestar
  • BYD
  • Audi
  • BMW
  • Mercedes

Benefits of salary packaging your car

Access fleet discounts
Reduce income tax
Smooth your budget
24/7 driver support
Save on GST*
Cashless servicing and repairs

Novated Lease Frequently Asked Questions

Can I novate an electric car?

Yes, with a Fleetcare Novated Lease, you have the option to choose an electric vehicle, hybrid vehicle, petrol vehicle, or a diesel vehicle.

How does a novated lease work with an electric car?

A novated lease is a salary packaging option that lets you pay for an electric car and its running costs from your pre-tax salary. It’s a three-way agreement between you, your employer, and Fleetcare.

How do I know if I’m eligible for a novated lease?

If you’re a salaried employee, completed your probation period at work and your employer is happy to enter into the agreement with us, you’re eligible.

Is an electric car procured through a novated lease eligible for the FBT exemption?

An electric vehicle procured through a novated lease is eligible for an FBT exemption, so long as it meets the exemption criteria.

The FBT exemption applies to vehicles where the following criteria are met:

  • The car is a zero or low-emissions vehicle
  • The first time the car is both held and used is on or after 1 July 2022
  • The car is used by a current employee or their associates (such as family members)
  • Luxury Car Tax (LCT) has never been payable on the importation or sale of the car

For more information, we've curated a guide to help you understand the electric vehicle FBT exemption.

Will an electric vehicle procured through a novated lease also be eligible for State-based EV Rebates and Incentives?

Electric vehicles acquired through a novated lease may qualify for state-based EV rebates and incentives, reducing the cost of ownership. We can help identify your eligibility and applicable terms.

How do electric vehicle running costs compare to a petrol or diesel novated lease?

Although fuel costs are removed, electric vehicles still require registration, maintenance and tyres which are all claimable with a novated lease agreement. Electric vehicles have lower repair costs compared to petrol or diesel vehicles, so you total running cost allowance will be lower.

Where can I find out more about a novated lease?

To find out more about a novated lease, check out our tools and resources that are listed below:

Want to know more about novating an electric car?

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Disclaimer: Income Tax savings are dependent on your taxable income and individual tax status. GST savings take into consideration your employers accounting methods and internal policies around GST, and passing on input tax credits.

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