Novated Lease Calculator — EV, PHEV and Petrol, With FBT

The saving is the tax you no longer pay on the part of your salary that goes to the car, less any FBT and less the post-tax employee contribution. On $100,000 with a $60,000 electric car over five years and $5,000 a year of running costs, the pre-tax deduction is $13,624 a year and take-home pay falls $9,265 — so the tax system carries $4,359 of the $13,624. Enter your own salary and car price above; the answer moves with your marginal rate.

It depends on the car and the FBT treatment, not on your salary alone. Over five years, the $60,000 electric car above costs $63,205 out of take-home pay including the $16,878 residual, against $85,000 to buy the same car and run it from after-tax income — $21,795 better. A $45,000 petrol car on the employee contribution method comes out $5,545 ahead; the same car left on the statutory formula is $9,971 worse off than buying it. Neither side of that comparison includes lease interest.

Under the statutory formula the taxable value is (A x B x C ÷ D) − E: A is the base value (the GST-inclusive cost price, excluding registration and stamp duty), B is the statutory rate of 20%, C is the days the car was available for private use, D is the days in the FBT year, and E is your post-tax employee contribution. FBT is then 47% of that value grossed up at 2.0802. On a $60,000 car that is $12,000 of taxable value and $11,732 of FBT for a full year.

ECM means paying part of the car's cost from post-tax salary. Every dollar of employee contribution reduces the FBT taxable value by a dollar, and a dollar of taxable value costs $0.98 in FBT — so contributing the full statutory value wipes out the FBT entirely. It pays until your marginal rate reaches 49.4%, which is above the 47% top rate including the Medicare levy, so in 2026-27 ECM is the cheaper method at every marginal rate.

A battery electric or hydrogen fuel cell car is exempt if it was first held and used on or after 1 July 2022 and luxury car tax has never been payable on it — that means a GST-inclusive value at or under the LCT fuel-efficient threshold, $91,661 for 2026-27. One dollar over and the whole exemption is gone, not just the excess. Associated running costs — registration, insurance, repairs, and electricity to charge it — are exempt too.

Only under a pre-existing arrangement. From 1 April 2025 a plug-in hybrid is no longer a zero or low emissions vehicle, so a PHEV novated lease signed today is fully subject to FBT. A PHEV keeps the exemption only where it was used, or available for use, before that date and there is a financially binding commitment to keep providing it — and the ATO has no discretion to extend the date, even for delivery delays. Any change to that commitment, including an optional extension, a change to the lease payments or residual, or a change of employer, ends the exemption from that point.

Yes, and in both directions. The pre-tax deduction lowers your taxable income, but the car also creates a reportable fringe benefits amount, and your compulsory repayment is worked out on repayment income — taxable income plus that reportable amount. On the $60,000 electric car above, the reportable amount is $22,641, which lifts repayment income to $109,017 and the repayment from $4,571 to $5,923 — $1,352 more, on a $69,528 threshold. An FBT-exempt car is not exempt from reporting.

It can. Your reportable fringe benefits amount is added to income for the Medicare levy surcharge test, so a lease can pull your surcharge income back over a tier threshold even while your taxable income falls below it. The same amount counts for Division 293 tax and the private health insurance rebate. It is never taxed itself — it only sits in the income tests.

As two lines, not one. The pre-tax (salary sacrifice) deduction comes off your gross before tax is worked out, so your taxable income and your PAYG withholding both fall. Any employee contribution appears as a separate post-tax deduction after tax. Check that the pre-tax line matches your packaging quote's lease and running-cost budget, that the post-tax line matches the FBT taxable value if you are on ECM, and that your year-to-date gross has fallen by the pre-tax amount.

No. The FBT year runs 1 April to 31 March — currently 1 April 2026 to 31 March 2027 — while the income year runs 1 July to 30 June. The statutory formula apportions by days in the FBT year, so a lease starting mid-year produces a part-year taxable value, and the reportable amount for an FBT year appears on your income statement for the income year ending on the following 30 June.

It should not. Under Payday Super, qualifying earnings include salary sacrificed amounts that would otherwise be qualifying earnings, so your employer's super should still be calculated on your pre-sacrifice salary. Check your payslip: if the super line fell when the lease started, ask payroll which figure they are using.

A percentage of the original cost that you pay from after-tax money if you want to keep the car. The ATO's minimum residuals are 65.63% for a one-year lease, 46.88% for three years and 28.13% for five — so a $60,000 car on a five-year lease still has $16,878 to pay at the end. The calculator counts the residual in the total, because otherwise the comparison against buying the car is not a fair one.