Benefits and considerations for EV leasing
Whether you're looking to lower your running costs,^ or simply enjoy the experience of an electric vehicle, a novated lease with TFM is a smart way to electrify your drive.
What’s in it for me?
Tax exemptions
Benefit from Fringe Benefit Tax (FBT) exemptions,* which can lower your monthly payments.
Low running costs
Enjoy typically cheaper fuel and lower maintenance costs of a Battery Electric Vehicle^ (when comparing to a typical petrol/diesel vehicle).
Simple budgeting
Bundle all your vehicle expenses into the one monthly pre-tax salary deduction with TFM.
EV eligibility criteria
As outlined by the Australian Tax Office, your chosen vehicle must:
- Be a Battery Electric Vehicle (BEV).
- Have first been used (and held) on or after 1 July 2022.
- Have not ever been liable to luxury car tax (LCT).
- Have a payload of less than one tonne.
- Have 8 seats or less.
The FBT exemption and Novated Leasing on EVs
If you choose an FBT-exempt EV, your lease payments and running costs can be deducted entirely from your pre-tax salary. That’s different to petrol and diesel vehicles, which require some post-tax contributions.
It should be noted, however, that you’ll still carry a Reportable Fringe Benefit Amount (RFBA) on a leased BEV. This doesn’t impact your taxable income, it just shows up on your income statement in myGov/ATO systems. It can affect how the Australian Government calculates some payments it has with you, like HECS/HELP repayments, childcare subsidies, family tax benefits or child support.
Try our online calculator to compare the costs of EVs with other vehicles, or to see how novated leasing stacks up against other finance options you consider.
A note on benefit caps
For exempt or rebatable employers (such as hospitals and not-for-profits), this employer FBT exemption won’t contribute to your benefit caps, so you can keep space for other perks. You can learn more about this on our EV requirements page.
