EV Novated Lease Value Guide for High-Mileage Drivers

Electric vehicles paired with a novated lease offer Australian employees one of the most tax-effective ways to drive a new car. For high-mileage drivers, the savings multiply further because lower running costs stretch across more kilometres each year.

This guide explains EV novated lease running costs, FBT exemption rules, calculator inputs, and total value specifically for drivers who clock up serious distance. Fingo’s EV novated lease packages bundle these benefits together so you can see exactly how much you’ll save over your lease term.

Key Takeaways: EV Novated Lease Value Guide for High-Mileage Drivers

• The FBT exemption on eligible electric vehicles means you pay for your entire lease and running costs using pre-tax salary, potentially saving thousands annually.
• High-mileage drivers benefit more from EVs because electricity costs significantly less than petrol, and the savings scale with each kilometre you travel.
• PHEVs no longer qualify for new FBT-exempt leases from 1 April 2025, so battery electric vehicles are now the only eligible option for new agreements.
• Fingo gives you EV novated lease packages with full expense bundling, transparent cost breakdowns, and same-day approval to get you on the road faster.
• A novated lease calculator helps estimate your tax savings, running costs, and take-home pay impact based on your salary, vehicle price, and annual kilometres.

What Is an EV Novated Lease and How Does It Work?

A novated lease is a three-way agreement between you, your employer, and a finance provider. Your employer deducts lease payments directly from your salary before tax (if the EV is eligible for the FBT exemption), reducing your taxable income and simplifying your vehicle costs into one regular payment.

When you lease an eligible electric vehicle through this arrangement, the Australian Government’s Electric Car Discount exempts you from Fringe Benefits Tax entirely. This means every dollar you sacrifice goes toward your car and running costs, with no additional post-tax contributions required to offset FBT.

For petrol or diesel vehicles, employees typically need to make post-tax Employee Contribution Method (ECM) payments to bring FBT down to zero. With an eligible EV, that requirement disappears, as the FBT has been exempted.

How Does the FBT Exemption Work for Electric Vehicles?

Under the Treasury Laws Amendment (Electric Car Discount) Act 2022, certain electric vehicles are fully exempt from FBT when specific criteria are met. According to the Australian Taxation Office, the exemption applies when:

• The vehicle is a battery electric vehicle (BEV) or hydrogen fuel cell vehicle
• It was first held and used on or after 1 July 2022
• The vehicle’s value is at or below the luxury car tax threshold for fuel-efficient vehicles ($91,661 for FY 2026-2027)
• A current employee or their associates use the car

The exemption also covers associated running costs including registration, insurance, repairs, maintenance, and electricity for charging. This makes the financial advantage of an EV novated lease substantial compared to traditional vehicle finance.

Why Did PHEVs Lose FBT Exemption Status?

Plug-in hybrid electric vehicles (PHEVs) were included in the FBT exemption until 31 March 2025. From 1 April 2025, new PHEV novated lease agreements no longer qualify for the exemption.

This policy change reflects the Government’s push toward fully electric vehicles as part of broader emissions reduction goals. If you currently hold a PHEV lease that started before 1 April 2025, your exemption continues for the remainder of that lease term.

For anyone starting a new lease now, pure battery electric vehicles are the only option for FBT-exempt status. This makes the choice between EV and PHEV clearer from a financial perspective, as the tax savings gap has widened significantly.

What Running Costs Are Included in an EV Novated Lease?

One of the main benefits of a novated lease is that it bundles your vehicle’s running costs into a single payment. For electric vehicles, these typically include:

• Electricity for charging: Whether you charge at home or at public stations, these costs can be included in your pre-tax payments
• Registration: Annual fees are covered so you don’t need to budget separately
• Insurance: Protection against unforeseen events is built into your package
• Servicing and maintenance: Regular upkeep keeps your vehicle in good condition without surprise bills
• Tyre replacements: Periodic changes maintain safety and performance

For high-mileage drivers, bundling these expenses is particularly valuable. When you’re travelling 25,000 to 40,000 kilometres annually, the cost of charging and tyre replacement alone becomes a major budget items. EVs turn this into an advantage.

How Much Do High-Mileage Drivers Save on Fuel Costs?

The fuel cost difference between petrol and electric vehicles scales directly with how much you drive. At current electricity and petrol prices, the savings become substantial for high-mileage users.

A typical petrol vehicle costs approximately $3,200 to $4,300 annually in fuel when driven 20,000 to 30,000 kilometres. The same distance in an electric vehicle costs roughly $500 to $750 in electricity when primarily charged at home.

This represents a saving of $2,700 to $3,550 per year on fuel alone. Over a three-year lease, that adds up to $8,100 to $10,650. For drivers covering even more distance, the advantage increases proportionally.

Fingo includes charging costs in your running costs package, so these savings flow directly into your monthly payment structure.

How Do Tax Savings Vary by Salary Level?

Your income tax savings from an EV novated lease depend on your marginal tax rate. Higher earners save more in absolute terms because each dollar of salary sacrifice reduces taxable income at a higher rate.

For a $62,000 electric vehicle leased over three years with estimated running costs of $7,000 annually, here’s how savings typically break down:

• $65,000 salary: Approximately $6,000 annual tax saving
• $95,000 salary: Approximately $6,500 annual tax saving
• $120,000 salary: Approximately $7,700 annual tax saving
• $160,000 salary: Approximately $9,100 annual tax saving

In addition to income tax savings, you save GST (up to the Input Tax Credit: $6,353 for FY 2026-2027)on the purchase price in the first year. For a $62,000 vehicle, this GST component is approximately $5,600. Your total first-year benefit can range from $11,600 to over $15,000 depending on your salary bracket.

What Inputs Does a Novated Lease Calculator Need?

A novated lease calculator helps you estimate your potential savings before committing. To get an accurate estimate, you’ll need to input several key details.

Vehicle Details

Enter the make, model, and drive-away price of the EV you’re considering. The calculator uses this to determine finance costs and GST savings. Confirm whether the vehicle qualifies as an FBT-exempt EV.

Your Annual Salary

Your pre-tax income determines your marginal tax rate and therefore how much you save by salary sacrificing. Be accurate here for realistic estimates.

Annual Kilometres Travelled

This affects your estimated running costs, particularly charging or fuel expenses. High-mileage drivers should input their actual expected travel distance rather than defaulting to average figures.

Preferred Lease Term

Most EV novated leases run between one and five years, with three years being common. Shorter terms mean higher monthly payments but less total interest. Longer terms spread costs but may not align with battery warranty periods on some vehicles.

What Should High-Mileage Drivers Consider When Choosing an EV?

Range and charging speed matter more when you’re covering serious distance. Here are the factors to weigh up.

Real-World Range vs Rated Range

Manufacturer-quoted WLTP range figures are measured under idealised conditions. In reality, highway driving, air conditioning, and cold weather reduce range by 15-25%. A vehicle rated at 500km range might deliver 380-425km in typical Australian conditions.

If your daily commute or regular routes exceed 200km between charging opportunities, prioritise vehicles with larger batteries and faster charging capability.

Charging Infrastructure Access

Home charging remains the most economical option for EVs. If you can install a dedicated charger (typically $800-$2,500 including installation), you’ll charge overnight at off-peak electricity rates. Note that the charger installation cost cannot be included in your novated lease running budget.

For regional travel, consider the fast-charging network coverage along your regular routes. Tesla’s Supercharger network has broad Australian coverage, while other brands rely on third-party networks like Chargefox, Evie, and BP Pulse.

Battery Chemistry and Longevity

Two main battery types dominate the EV market. Lithium Iron Phosphate (LFP) batteries, used by BYD and some Tesla models, handle daily charging to 100% without significant degradation. Nickel Manganese Cobalt (NMC) batteries offer better energy density but manufacturers recommend charging to 80-90% for daily use.

For a three-year lease, either chemistry performs well. Over five years, LFP batteries may retain more capacity for high-usage drivers.

How Does Home Charging Affect Your Running Costs?

Charging location significantly impacts your EV running costs. Home charging at off-peak rates typically costs $0.08-$0.20 per kilowatt-hour depending on your state and electricity plan.

Public fast charging costs considerably more, often $0.60-$0.85 per kilowatt-hour. If you relied exclusively on public charging, your running cost advantage over petrol would narrow substantially.

The ATO allows employers to use a shortcut EV home charging rate when calculating electricity costs for FBT purposes. For 2025-26, this rate simplifies record-keeping while ensuring accurate expense reporting.

For high-mileage drivers, installing home charging capability isn’t just convenient. It’s essential for maximising the financial benefits of your EV novated lease.

What Is the RFBA and How Does It Affect HECS/HELP?

Even though an eligible electric vehicle may be exempt from Fringe Benefits Tax (FBT), the benefit can still give rise to a Reportable Fringe Benefits Amount (RFBA) that is reported through your income statement.

The RFBA itself is not additional taxable income and is not taxed directly. However, it is taken into account for a number of income-tested government obligations and entitlements.

This can include:

• HECS/HELP and other study or training loan repayments
• Medicare Levy Surcharge (MLS) income tests
• Division 293 tax for higher-income earners
• Certain other government benefits, offsets and income-tested obligations

For employees with a HECS/HELP debt, this is particularly important. The RFBA can increase the income used to determine your compulsory student loan repayment, potentially increasing the amount you are required to repay for the financial year.

The higher the value of the EV and associated benefit, the larger the potential RFBA. Therefore, if you have a HECS/HELP debt or are affected by other income-tested obligations, it’s important to consider the potential RFBA impact when assessing the overall savings from a novated lease.

An FBT-exempt EV can still deliver significant tax savings, but FBT-exempt does not mean the benefit is excluded from all income-based calculations.

What EVs Are Popular for Novated Leasing in Australia?

Several electric vehicles sit comfortably below the $91,387 LCT threshold while offering solid range and features for high-mileage drivers.

Tesla Model 3 and Model Y

Tesla leads Australia’s EV market with these two models. The Model 3 sedan and Model Y SUV both offer long-range variants with over 500km rated range. Tesla’s Supercharger network adds convenience for interstate travel.

BYD Atto 3, Dolphin, and Seal

BYD has gained significant market share with competitive pricing and LFP battery technology. The Atto 3 compact SUV starts under $45,000, making it an accessible entry point for EV novated leasing.

Hyundai Ioniq 5 and Kona Electric

Hyundai offers reliable EV options with good warranty coverage. The Ioniq 5 features an 800-volt architecture allowing faster charging speeds.

Kia EV5 and EV6

Kia’s electric SUVs combine practical interiors with competitive range. The EV5 has entered the market at attractive price points for salary packaging.

Fingo offers access to novated leases across all these models and more, with tailored packages based on your driving needs.

What Are the Steps to Set Up an EV Novated Lease?

Getting into an EV novated lease is more straightforward than many expect. Here’s the typical process.

Step 1: Confirm Employer Participation

Check with your HR or payroll team that your employer offers salary packaging and novated leasing. Most medium and large Australian employers do. Some may have a preferred provider panel.

Step 2: Choose Your EV and Get a Quote

Select a vehicle under the LCT threshold and obtain a formal drive-away price from a dealer. This figure includes on-road costs like registration, stamp duty, and dealer delivery.

Step 3: Compare Provider Quotes

Request quotes from two or three novated lease providers. Look at the interest rate, administration fees, and running cost budget breakdown. Don’t commit based on a verbal figure alone.

Step 4: Set Your Running Cost Budget

Work with your provider to estimate annual running costs based on your expected kilometres. Include electricity, registration, insurance, servicing, and tyres. An accurate budget helps avoid year-end adjustments.

Step 5: Sign Documentation

Your provider coordinates a Deed of Novation with your employer. Once everyone signs, salary deductions begin on your next pay cycle.

Fingo offers same-day approval and handles all paperwork, getting you on the road without unnecessary delays.

What Happens If You Change Jobs During a Lease?

Transferring a novated lease to a new employer is usually possible, though it requires your new employer’s agreement to continue salary deductions under the arrangement.

Not all employers offer novated leasing, so this is worth considering if you’re in an industry with high job mobility. If your new employer doesn’t participate, you may need to continue payments from post-tax income until the lease ends or you find another solution.

Some lease providers offer more flexibility than others for these situations. Discuss portability options before signing.

Is an EV Novated Lease Right for Every Driver?

An EV novated lease isn’t the perfect fit for everyone. It makes less sense if:

• Your employer doesn’t offer salary packaging
• Your income is below $45,000, where the marginal tax rate provides smaller savings
• You have no access to home or workplace charging and would rely solely on public charging
• You frequently drive long distances in areas with poor fast-charging coverage
• You’re in a casual or contract role with uncertain employment tenure

For drivers who tick most of the eligibility boxes and travel significant kilometres annually, the combined tax savings and reduced running costs make EV novated leasing one of the most financially attractive ways to drive a new car in Australia.

Why Choose Fingo for Your EV Novated Lease?

Fingo brings specialist support for electric vehicle novated leases with a focus on transparency and personalised service. Over 20,000 customers have used Fingo’s services, benefiting from clear cost breakdowns and expert guidance through the leasing process.

Key advantages include:

• Full expense bundling: Charging, insurance, registration, maintenance, and tyres in one payment
• Transparent pricing: No hidden fees or surprise costs at year-end
• Fast approval: Get on the road faster with streamlined paperwork
• Fleet discounts: National purchasing power delivers better car prices even for individual vehicles
• Flexible service: Ongoing support throughout your lease term with the ability to adjust packages as needs change
• Fingo Advantage, our industry-leading guaranteed buy-back option on approved vehicles, gives you greater peace of mind at the end of your lease—particularly for EVs, where future resale values can be more difficult to predict. 
• As a Licensed Motor Car Trader (LMCT), Fingo can offer you the convenience and flexibility of trading in your existing vehicle directly with us, making it easier and faster to get into your next car. 
• Our dedicated team means you’ll receive personalised service from your first call right through to the end of your lease. You’ll always be dealing directly with our Australian-based team, without being passed from one department to another. 

Fingo simplifies the EV novated lease experience so you can focus on the benefits rather than the administration.

How to Calculate Your EV Novated Lease Savings

Ready to see real numbers? Start by gathering your annual salary, the drive-away price of your preferred EV, and your expected yearly kilometres.

Use a novated lease calculator to estimate your monthly payments, tax savings, and running costs. Compare the total cost over your lease term against buying the same vehicle outright or through traditional car finance.

For high-mileage drivers, the gap is often significant. Lower fuel costs, GST savings, and FBT exemption combine to make EV novated leasing a smart financial decision for those who spend serious time on the road.