The nation’s peak body for novated leasing is urging Australians to act quickly on purchasing a plug-in hybrid electric vehicle (PHEV), as the fringe benefits tax (FBT) exemption deadline approaches and wait times for some models blow out.
Eligible workers who salary sacrifice are exempt from paying FBT on PHEVs until 1 April 2025, whilst the exemption will remain for battery electric vehicles (BEV).
The National Automotive Leasing and Salary Packaging Association (NALSPA) CEO Rohan Martin said some PHEV models and variants through novated leasing are being snapped up quickly.
“If you want to save on the cost of owning and operating a plug-in hybrid, you better get in quick before the FBT exemption expires in April next year,” Mr Martin said.
“Now’s the time to seriously consider and enquire about getting into a PHEV which for many motorists means being able to drive on electricity for the bulk of the time, with the comfort of a petrol engine for those longer trips.
“The FBT exemption offers significant savings for your household by paying no FBT and reducing your taxable income through a novated lease arrangement. This saving could be as much as $20,000 or more for an employee over the term of a typical PHEV lease.
"While there is still plenty of stock available for some PHEV models and variants, demand for others is high and wait times are unfortunately extending to or beyond the April cut off. We also think that demand and delivery times are only set to continue to rise in the coming weeks – so the message is don’t wait, speak with your novated lease provider or local car dealer. To qualify for the exemption, our advice is that a financial commitment must be in place and that your PHEV must be available for your use, and therefore delivered to you, before 1 April 2025.
“With the help of the FBT exemption, Australians are loving plug-in hybrids with new sales more than doubling over the past year (up 100.4% to November 2024). PHEVs are a crucial stepping stone toward full electric driving. Compared with pure EVs, PHEVs meet the needs of a growing number of Australians by alleviating range anxiety and are projected to offer a greater range of electrified larger vehicle types like utes and dual cabs in the near future. Most PHEV drivers predominantly use electric power only and recharge at least twice a week.
“NALSPA has strongly advocated for the FBT exemption to remain in place for eligible PHEVs to help lower motoring related costs for everyday Australians during a cost-of-living crisis and get Australia closer to meeting its climate targets.
“The decision to end the FBT exemption for PHEVs couldn’t come at a worse time, especially as a range of hard-to-fully-electrify utes are just entering the market. The FBT exemption is playing a critical role in encouraging more everyday Australians, particularly those in regional areas, to make the switch to an electrified vehicle, so it wouldn’t be a surprise if demand for plug-in hybrid falls after April next year.”
Popular PHEVs via novated leasing include:
- Alfa Romeo Tonale
- BYD Sealion 6
- BYD Shark
- Cupra Leon VZe
- Cupra Formentor VZe
- Kia Sorento PHEV
- Mazda CX-60
- MG HS
- Mitsubishi Eclipse Cross
- Mitsubishi Outlander
- Volvo XC60
Media contact: Sofie Wainwright 0403 920 301