fbt for electric vehicles

Good news: eligible electric cars can be FBT‑exempt in Australia, which makes novated leases far less punishing than a Monday morning commute.

The exemption applies to zero or low‑emission vehicles first held and used on or after 1 July 2022, provided the car’s value sits under the fuel‑efficient Luxury Car Tax threshold.

It generally covers purchase and running costs supplied by the employer, but the benefit is still reportable (so it may affect income tests like a nosy neighbour).

Plug‑in hybrids were only grandfathered for arrangements entered before 1 April 2025; new PHEV deals after that date don’t get the free ride.

Chat with your payroll or lease provider for the fine print—eligibility and thresholds can change quicker than a 350 kW charger.