Electric vehicles (EVs) are no longer a fringe trend — they’re the future of transport in Australia. With lower running costs, environmental benefits, and increasing government support, EVs are a smart choice for drivers.
Combine that with a novated lease, and you unlock even greater value.
Here’s how novated leasing works with electric vehicles and why it could be one of the most cost-effective ways to go electric.
A novated lease is a salary packaging arrangement between you, your employer, and a finance provider. It allows you to lease a vehicle using your pre-tax salary, helping to reduce your taxable income.
Running costs like registration, insurance, servicing, and EV charging are bundled into one regular payroll deduction — making ownership simple and financially smart.
EVs already have lower running costs compared to petrol or diesel vehicles. But when you package an EV through a novated lease, you unlock even more financial advantages — thanks to Fringe Benefits Tax (FBT) exemptions.
Under current Australian tax rules, if you lease a zero- or low-emissions vehicle (electric or hydrogen fuel cell) that’s below the Luxury Car Tax (LCT) threshold — you don’t pay any FBT.
100% of the lease and running costs can be salary packaged tax-free
You save on both income tax and fringe benefits tax
Your take-home pay impact is dramatically reduced
For example, the Tesla Model 3, BYD Atto 3, MG ZS EV, and other popular EVs fall within the LCT cap, making them ideal for novated leasing.
When you lease an EV through Prosperity Smart Drive, you can include:
The vehicle cost
Registration and insurance
Scheduled servicing and maintenance
Tyres and roadside assistance
EV charging costs (home or public charging)
Vehicle management services
Everything is bundled into a single, predictable payroll deduction — giving you control and peace of mind.
By choosing an EV novated lease, you’re not only saving money, but also:
Reducing emissions and supporting net-zero goals
Future-proofing against rising petrol prices
Aligning your transport choice with sustainability values
It’s a win for your wallet and the planet.
While EV novated leasing offers significant benefits, consider:
Limited charging infrastructure in some areas (though improving rapidly)
Higher upfront cost of EVs (offset by tax savings and FBT exemption)
Lease commitments — usually 2–5 years
A Prosperity Smart Drive adviser can help you compare options and assess what works for your needs.
Novated leasing makes driving an EV more affordable, accessible, and sustainable — especially under current FBT exemptions. Whether you’re an individual looking to reduce your tax and carbon footprint, or an employer supporting sustainable transport, EV novated leases are a smart move.
Whether you’re looking to maximise tax savings, simplify your car expenses, or switch to an EV, Prosperity Smart Drive can help you find the right novated lease solution.
Prosperity Smart Drive (ABN 61 120 563 215) Prosperity Advisers Group © 2025
