What Is a Novated Lease?
A novated lease is a popular way to finance a car in Australia. It’s a salary packaging arrangement between you, your employer, and the finance company. Under this setup, your employer makes lease repayments on your behalf using a portion of your pre-tax income, which may reduce your taxable income and help you manage running costs more effectively.
What Makes a Car a Good Fit for a Novated Lease?
Not every vehicle is equally suited to a novated lease. Some cars deliver more value through lower running costs, favourable tax treatment, and eligibility for fringe benefits tax (FBT) exemptions or concessions. When considering a car for novated leasing in 2025, key factors include:
- Fuel efficiency – Hybrid and electric vehicles typically offer lower running costs
- Affordability – Entry-level or mid-tier models are more accessible for a broader range of salaries
- Tax benefits – Eligibility for FBT exemptions or lower FBT liability improves overall value
- Reliability and servicing – Vehicles with low maintenance costs help keep total expenses down
Best Cars for a Novated Lease in 2025
Based on practicality, affordability, and potential tax advantages, here are some top picks for novated leases in 2025:
1. BYD Dolphin (Electric)
The BYD Dolphin is quickly becoming one of Australia’s most attractive entry-level electric vehicles. Compact yet impressively spacious, it boasts a modern interior, practical range for daily use, and a price point below the luxury car tax threshold—making it more accessible under a novated lease. Because it’s a battery electric vehicle (BEV), it may qualify for fringe benefits tax (FBT) exemptions, depending on your lease structure and employer policy. With a growing national service network and a reputation for efficiency, the Dolphin is a smart, forward-thinking option for drivers seeking environmental and financial value.
2. Tesla Model 3 RWD
The Tesla Model 3 remains one of the most in-demand EVs globally—and for good reason. The rear-wheel-drive (RWD) variant offers a strong mix of performance, comfort, and technology, with Tesla’s signature minimalist interior, intuitive software, and long electric range. It’s also priced under the LCT threshold, which supports its eligibility for FBT exemptions. With expanding Supercharger access across Australia and low running costs, the Model 3 is ideal for tech-savvy drivers using novated leasing to access premium EV features without the upfront price burden.
3. MG4 EV
The MG4 is one of the most affordable electric vehicles currently on the market in Australia, and it punches well above its weight in terms of value. It offers sharp styling, a responsive driving experience, and a surprisingly well-equipped interior for its price. Its competitive cost means it can comfortably fit into most salary brackets for novated leasing while still providing potential tax savings and reduced running expenses. If you’re looking to take your first step into electric motoring through a novated lease, the MG4 is a no-fuss, cost-effective place to start.
4. Toyota Corolla Hybrid
A long standing favourite in Australian driveways, the Toyota Corolla Hybrid delivers trusted reliability, excellent fuel efficiency, and low servicing costs. While it’s not a full EV, the hybrid system significantly reduces fuel use and emissions—making it a practical choice for long-distance commuters or urban drivers. It typically holds strong resale value and is easy to service across the country. For novated lease holders seeking to reduce costs without committing to full electrification, the Corolla Hybrid is a dependable and budget-conscious option.
5. Hyundai i30
The Hyundai i30 continues to be one of the most versatile and well-rounded hatchbacks available in Australia. Known for its comfortable ride, spacious interior, and good safety features, the i30 is especially attractive under novated leasing thanks to its affordable purchase price and low ongoing maintenance needs. It’s a top pick for drivers who want a reliable commuter vehicle that also provides a premium feel without the premium cost. The i30 works well for both solo drivers and small families looking for smart, economical transport.
6. Mazda CX-5
The Mazda CX-5 is a leading midsize SUV choice thanks to its refined interior, smooth handling, and efficient petrol or diesel engines. With strong resale value and excellent safety ratings, it’s an appealing option for employees looking to lease a versatile family car through their employer. Its comfort and tech features, such as Apple CarPlay, adaptive cruise control, and lane-keeping assist, make it ideal for long drives or daily commuting. The CX-5’s reputation for reliability further enhances its suitability for a novated lease arrangement.
7. Kia EV6 Air
The Kia EV6 Air brings high-end EV design and capability into the mainstream with bold styling, long range, and fast charging capability. The Air variant sits at the more accessible end of the EV6 lineup while still offering a premium feel and performance. For novated lease holders, it offers a compelling mix of tax-effective ownership and day-to-day driving pleasure. While its price may be higher than entry-level EVs, the potential benefits through salary packaging, along with government EV incentives, make it a standout choice in the premium electric segment.
Things to Keep in Mind
- Fingo is not a finance provider, but we work with reputable partners to help make novated leasing more accessible.
- Vehicles acquired under novated leasing should be used for personal purposes or a mix of personal and work use.
- Maintenance, registration, and other vehicle-related costs can often be packaged into your lease structure depending on your employer’s arrangement.
Choosing the right car under a novated lease in 2025 depends on your budget, driving habits, and the benefits available through your employer. Whether you’re aiming to reduce out-of-pocket expenses or looking for an EV that qualifies for tax concessions, novated leasing can offer a flexible way to drive the car you want—while potentially lowering your taxable income. Fingo keeps you up to date with the latest novated lease insights and vehicle options to help you make informed decisions with confidence.