Electric vehicles (EVs) are becoming an increasingly popular choice among those seeking to reduce their carbon footprint and potentially lower their motoring costs. But did you know you can include an electric vehicle in your salary package through an ORIX Novated Lease? ORIX Novated Lease provides you with the flexibility to choose from a range of new, used or luxury car models with different leasing options and inclusions tailored to your needs.
Discover how novated leasing an EV can revolutionise your driving experience while also optimising your take-home pay and contributing to a greener planet.
Let’s start from the beginning!
What is a Novated Lease?
A Novated Lease offers a simple and convenient way of including a vehicle in your salary package.
A Novated Lease through ORIX is a three-way agreement between ORIX, your employer and you. Simply choose a vehicle; ORIX will then use its purchasing power to get you a great price. All vehicle finance and running costs including, insurance, registration and servicing are bundled into one simple payment collected from your salary, saving you money.
Watch this video to help you understand how it works.
Explore the benefits of Novated Leasing
with an electric vehicle (EV)
GST Savings
Finance and running costs are GST-free and collected (in part or in full) from an employee’s gross salary, reducing taxable income and optimising take-home pay.
Additional Tax savings
The Treasury Laws Amendment (Electric Car Discount) Act 2022[1] has exempted eligible EVs (priced below the luxury car tax threshold for fuel-efficient vehicles, which is $89,332 for the 2023-24 income year) from Fringe Benefits Tax (FBT) along with the removal of the 5% tariff, which can lead to significant tax savings for individuals who acquire eligible EVs through a novated lease.
These exemptions only apply to EVs operated by businesses for personal use or novated leases. Private buyers are not eligible for the exemption.
Reduced operational and maintenance costs
The Electric Vehicle Council estimates that the average cost savings from driving an electric vehicle, including the reduced maintenance and servicing costs, amounts to $2,400[2] per year.
Fleet discounts
Take advantage of ORIX’s national purchasing power to receive fleet discounts[3] on the price paid for your selected vehicle. Save on running costs like maintenance and tyres with ORIX-negotiated discounts at ORIX-approved service providers.
Lease flexibility
Novated lease allows you to choose a lease term that best suits your budget and lifestyle. There’s even an option to move your lease to a new employer if you change jobs.
24/7 online access
ORIX OneView is an online tool that provides 24/7 reporting and lease information, and the ORIX Companion App makes it easy to manage your ORIX lease.
Make a move to electric now
Your guide to the Fringe Benefits Tax (FBT) Exemption for Electric Vehicles (EVs) in Australia
Download guide
By submitting my details, I acknowledge that I have read the ORIX privacy policy, and understand that ORIX will use my personal information to contact me in relation to my submission, and for other general marketing purposes.
FAQs
You can choose from a wide range of makes and models–new, used or a luxury vehicle. ORIX can even purchase your current vehicle and lease it back to you. Although most vehicles are eligible for an ORIX Novated Lease, some vehicles may be ineligible (for example, vehicles older than ten years or greater than 200,000 km by lease end). Please get in touch with an ORIX Novated Leasing Specialist for more information.
Yes. A Novated Lease on an EV offers you a simple and convenient way of including an EV in your salary package. Finance and running costs are GST-free and bundled into one simple payment collected from your salary (in part or in full), reducing taxable income and potentially optimising take-home pay.
The exemption applies to battery electric vehicles, hydrogen-fuel-cell electric vehicles and plug-in hybrid electric vehicles that are below the luxury car tax threshold, which is 89,332 in 2023-24 for fuel-efficient vehicles.
Plug-in hybrids will now be phased out as of 01/04/2025 but any contracts/commitments made before 01/04/2025 would be honoured.
The FBT exemption will run for a minimum of 5 years, from 1 July 2022 to mid – 20274 and will be reviewed at that time. The application of the law will be retrospective to eligible vehicles registered after 1 July 2022. Any novated lease entered before 30 June 2025 will be eligible for this exemption through to lease expiration.
A second-hand electric vehicle may qualify for the exemption, provided that the vehicle was first purchased new on or after 1 July 2022 and will not have greater than 200,000 km by lease end. Please get in touch with an ORIX Novated Leasing Specialist for more information.
Approximately three months before the end of your lease, ORIX will send you a reminder. We will work with you to choose what to do next. You can extend the term of your lease, offer to purchase the vehicle from ORIX, or finance a new vehicle. If you have a finance lease, there will be a residual amount that you will need to pay to ORIX. If you have an operating lease, there is no balloon amount or similar to pay.
Electric vehicle Vs petrol vehicle
We’ve compared the potential savings you could enjoy for a petrol vehicle with what you could enjoy under the FBT exemption for an electric vehicle if acquired via an ORIX Novated Lease.
Tesla Model Y
Novated LeaseMonthly salary impact
- Gross Salary $100,000
- Annual Pre-Tax $17,970
- Revised Gross Salary $82,030
- Tax $18,767
- Annual Post Tax $0
- Take Home Pay $63,263
- Annual Salary Impact $11,771
Mazda CX-5
Novated LeaseMonthly salary impact
- Gross Salary $100,000
- Annual Pre-Tax $7,084
- Revised Gross Salary $92,916
- Tax $22,522
- Annual Post Tax $7,600
- Take Home Pay $62,793
- Annual Salary Impact $12,241
The table is for illustration purposes only. It does not take into consideration, individual facts and circumstances, which may otherwise impact the indicative numbers provided in the table. Vehicle pricing, rates/fees etc. are subject to change and stage 3 tax cuts taking effect from 1 July 2024 will also impact on the numbers.
These calculations use a number of assumptions (including that the employee has no other existing salary packaged item) to provide an estimate of the Novated Lease cost and the potential savings from entering into such a lease. In most cases, a formal quote will be less expensive than the indicative quote because of ORIX’s buying power and refinement of estimated maintenance costs. The assumptions used by this Novated Lease Calculation are set out in ORIX’s Terms & Conditions found at www.orix.com.au/novated-leasing/calculator.html Tax rates based on 2023 ATO guidelines for an individual
Curious to know how much you can save?
Use this handy online calculator to estimate your savings based on your chosen vehicle.
Find out how we can help
Talk to an ORIX Novated Specialist to learn how you can buy an eligible electric vehicle with a novated lease and save on costs.
By submitting my details, I acknowledge that I have read the ORIX privacy policy, and understand that ORIX will use my personal information to contact me in relation to my enquiry, and for other general marketing purposes.
[1] Source: Treasury Laws Amendment (Electric Car Discount) Act 2022 (legislation.gov.au)
[2] This calculation has been sourced from Electric Vehicle Council website (https://electricvehiclecouncil.com.au/about-ev/faqs/) and is based at current electricity prices. The calculation is for reference purposes only. It does not take into consideration, individual facts and circumstances, which may otherwise impact the indicative numbers.
[3] Discounts may be brand dependent, or there may be a potential discount. Depending upon the State, additional EV rebates or exemption may also apply. These vary on eligibility in each State but could potentially be taken of advantage of.
[4] Source: Electric vehicles and fringe benefits tax | Legal database (ato.gov.au)
