Is EV FBT Exempt from Novated Lease?
When it comes to novated leasing an electric vehicle (EV) in Australia, there has been much talk about Fringe Benefits Tax (FBT) exemptions. The good news for EV enthusiasts is that the Australian government introduced an FBT exemption for certain EVs, which can make leasing an electric vehicle more financially attractive.
In 2022, the federal government launched this initiative as part of its push towards reducing carbon emissions and increasing the adoption of electric vehicles. The FBT exemption applies to EVs that meet specific criteria, such as having a purchase price below the luxury car tax threshold for fuel-efficient vehicles, and only to zero- or low-emission vehicles (battery electric vehicles and some plug-in hybrid electric vehicles).
For those using a novated lease arrangement, this means you can enjoy significant tax savings as part of your lease. With the FBT exemption in place, you could potentially save thousands of dollars over the course of your lease term, as the FBT would have otherwise increased the overall cost of the lease.
This FBT exemption makes EVs an even more attractive option for both individuals and businesses, as it effectively lowers the financial burden associated with running and maintaining a vehicle. It also aligns with Australia’s broader goals of promoting sustainability and reducing reliance on fossil fuels.
However, it's important to note that this exemption is subject to specific conditions. It applies only to certain electric vehicles purchased after July 1, 2022, and you should always consult with your leasing provider or a tax professional to confirm eligibility.
In conclusion, the FBT exemption for EVs within novated leases can result in substantial savings. If you’re considering an EV for your next novated lease, it’s worth exploring this opportunity to save money while driving a more environmentally friendly vehicle.
Ready to explore your options for leasing an electric vehicle and taking advantage of FBT exemptions?
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