Novated electric vehicle leasing opens to 67 per cent of Australia's workforce

Yesterday at 12:00 AM

A vast new cohort of Australians can now access one of the federal government's most generous electric car incentives.

Until recently, only employees of large corporations and organisations could benefit from the Australian Government's money-saving electric vehicle FBT exemption (Fringe Benefits Tax) when purchasing a vehicle on a novated lease.

RELATED: The benefits of an electric vehicle and the EV Discount

The prohibitively complex administration meant the scheme was not accessible to the 67 per cent of Australians who work for a small-to-medium business.

However, an industry-first initiative between Hyundai and Australian finance firm Oly has opened novated leasing to the millions of Australians employed by a small-to-medium business, meaning it's possible to own a $60,000, brand-new electric car for the same weekly cost as a $39,000 petrol one when purchased on a five-year novated lease. 

The new arrangement is only available with Hyundai electric vehicles.

"This is the first direct-to-consumer novated leasing product, opening this benefit and its savings up to a huge new group of Australians," said Will Clarke, Head of Corporate Communications & Government Relations at Oly.

"For the 67 per cent of Australians employed by a small-to-medium enterprise (SME), a novated lease just hasn’t been possible until now. Customers can walk into a Hyundai dealership and drive out with a novated lease that could save them tens of thousands over the life of the lease."

A novated lease packages your new car's costs – from the loan repayments to the registration, insurance, fuel and servicing – and allows an employee to pay part of it with their pre-tax salary, lowering their taxable income.

EVs take this to another level thanks to a generous incentive from the Australian government which exempts EVs, up to the value of $91,387, from Fringe Benefits Tax. We explain more about FBT and electric vehicles in detail here, but it's almost a government rebate for electric cars.

This incentive has contributed to more EVs hitting Australian roads. In 2023, nearly 90,000 new electric cars were sold in Australia – a new record.

New platform streamlines admin for employers

A new technology platform from Oly minimises the administration of novated leasing for owners of small-to-medium businesses, meaning they can offer novated leasing to employees without the traditional paperwork.

If you work for a small-to-medium business and are eager to salary-sacrifice an electric car in Australia, visit your local Hyundai dealer and enquire about an electric vehicle, and tell them you'd like to get an Oly novated lease.

Hyundai and Oly will manage the rest, including contacting your employer about how much to take from your pay. "By partnering with Hyundai and offering this benefit directly through dealerships, Oly offers a straightforward process to buyers," said Clarke.

Drive recommends consulting a trusted accounting professional to discuss your specific financial circumstances prior to purchasing a new vehicle on a novated lease.

Hyundai EVs voted some of the best

While the new deal is limited to Hyundai products, Hyundai is one of the leading EV brands not just in Australia, but the world.

In the urban wilderness of wherever you live, you may have spotted a new Hyundai Ioniq 5, the electric hatch that brings boxy back with its unique pixel design language – like it's just driven out of the future.

Or maybe the Hyundai Ioniq 6, the aerodynamic sedan with the wind-honed profile that makes a Tesla Model 3 look comparatively plain.

With its concept car styling, the more compact, electric Hyundai Kona SUV may have also caught your eye.

The Ioniq 6 was the 2023 World Car of the Year and the Ioniq 5, 2022 World Car of the Year before that. The petrol Kona range was voted Drive's own Best Small SUV Under $50K for 2024.

On a novated lease, you could be driving a $69,493, brand-new, fully electric Hyundai Ioniq 6 for the same weekly price as a $38,990, brand-new, petrol Mazda CX-5. That's for an individual earning $90,000, travelling 15,000km and leasing over five years.

Free servicing and a home charger for new Hyundai EVs

If you buy an electric Hyundai on a novated lease between now and October 31 – enjoying the electric car tax deduction in Australia – Hyundai will include a free four-year, 60,000km service plan. That's $1190 in the case of the Ioniq 6.

Hyundai will also include an Autel Maxicharger home recharging wall box worth $1480. This is a 22kW three-phase unit, currently the fastest Type 2 charger on the market. As EVs get higher tech, you'll have future-proofed your home – and potentially added to its value. (Note that this excludes installation.)

New Hyundai novated EV leaseholders can opt for a $1500 Evie network charging voucher instead. Evie is one of the largest charging networks in Australia with 240 sites, all powered by 100 per cent renewable energy.

The post Novated electric vehicle leasing opens to 67 per cent of Australia's workforce appeared first on Drive.