Electric vehicles (EVs) have become more accessible, more affordable, and more appealing than ever — especially in 2025. As government incentives expand and infrastructure improves across Australia, many drivers are making the shift to electric. But rather than buying outright, a growing number are choosing an electric vehicle novated lease to take full advantage of cost savings and flexibility. From EV novated lease tax benefits to simplified running costs through salary packaging electric vehicles, EV leasing could be the smartest move for your wallet and the planet this year. Let’s explore why.
Why More Australians Are Leasing Their EVs
Leasing, particularly through a novated lease, gives you access to the latest EV models without the upfront expense of a traditional car loan or outright purchase. But the real appeal? Tax savings. EVs leased through novated arrangements are currently exempt from Fringe Benefits Tax (FBT) — which can mean serious savings, especially on high-value vehicles.
Other key reasons Aussies are opting for EV leases in 2025 include:
- Avoiding depreciation by upgrading every few years
- Lower running costs (no fuel, fewer moving parts, less servicing)
- Access to new tech and safety features
- Driving an environmentally conscious vehicle with zero tailpipe emissions
Who Should Consider Leasing an EV?
An electric vehicle novated lease is best suited to:
- Full-time employees working for companies that offer salary packaging
- Drivers who want predictable monthly payments (with running costs included)
- People who want to drive a better car than they could afford upfront
- Anyone considering an EV for the tax perks, eco benefits, and performance
If you drive a lot for work or simply love upgrading to the newest model every few years, leasing gives you more freedom without long-term ownership costs. That said, it may not be right for everyone — especially those who plan to drive their car for 10+ years, or who work for employers that don’t offer salary packaging.
What Are the Tax Benefits of Leasing an EV?
There’s a lot to love about EV novated lease tax benefits in 2025. Thanks to government policy, eligible electric vehicles valued under the luxury car tax threshold (currently around $89,000 for EVs) are exempt from FBT under a novated lease.
This means your lease payments — as well as running costs like insurance, servicing, and registration — can be paid from your pre-tax income. The result? A lower taxable salary and higher take-home pay.
In many cases, this makes EVs even more cost-effective than petrol-powered cars, despite their higher purchase price.
Can You Lease a Used EV?
Absolutely. While new EVs are often the go-to, used electric vehicles can also be leased — provided they meet the finance provider’s age, condition, and mileage criteria. This can be a great option for drivers wanting to reduce costs even further or get into the EV space without the premium price tag of new models.
Just keep in mind that FBT exemptions apply only to new or first-use electric vehicles, so used EVs may not offer the same level of tax benefits.
Pros and Cons of Leasing an EV
Pros:
- FBT exemption for new EVs
- No large upfront payment
- Fixed monthly budgeting with bundled costs
- Regular upgrades to newer models
- Lower servicing and fuel costs
Cons:
- You don’t own the car unless you buy it at the end of the lease
- Early termination fees usually apply
- Not ideal for those with inconsistent employment or income
- Employers must support salary packaging electric vehicles
Is It Time to Make the Switch to an EV?
If you’ve been eyeing an electric car and want to make a smarter, tax-effective move in 2025, an electric vehicle novated lease is a great option to consider. Between the growing model range, reduced running costs, and generous EV novated lease tax benefits, it’s never been easier or more affordable to go green. Just make sure your employer supports salary packaging electric vehicles and that the car you choose qualifies under current exemptions. With a little research and the right structure, your next car could be electric — and financially savvy.
