With the Fringe Benefits Tax (FBT) exemption for Plug-in Hybrid Electric Vehicles (PHEVs) set to expire on 31st March 2025, now is the time to act if you want to maximise your savings on a novated lease. The financial benefits of PHEVs under this exemption are substantial, making them a smart choice for drivers looking to cut costs while enjoying the best of electric and petrol-powered motoring.
Why Consider a PHEV Now?
Since the introduction of the Electric Car Discount Bill in 2022, novated leasing for EVs and PHEVs has become significantly more attractive. This law allowed eligible vehicles to be exempt from FBT, translating to thousands of dollars in savings over the life of a lease. However, this PHEV exemption will no longer apply from 1st April 2025, meaning new PHEV leases taken out after this date will face higher running costs.
If you’re considering a new car and want to lock in the financial benefits of a low-emission, fuel-efficient vehicle, a PHEV through a novated lease is the way to go—but you need to act fast.
PHEV vs Hybrid vs Petrol: A Cost Comparison
To highlight the potential savings, let’s compare the Kia Sorrento in three different powertrains—PHEV, Hybrid (HEV), and Petrol (ICE)—when acquired via a novated lease:
Drivetrain | Recommended Retail Price | Out-of-Pocket (Fortnightly) | Estimated Savings Over 5 Years |
---|---|---|---|
PHEV | $84,660 | $589 | $42,384 |
HEV | $70,330 | $719 | $17,232 |
ICE | $68,590 | $721 | $18,046 |
(Based on a Paywise novated lease quote for a driver on a $90,000 salary, driving 15,000km per annum, over a 5-year lease term.)
Despite having the highest purchase price, the PHEV variant delivers the greatest savings—over $42,000 in five years. This is mainly due to its FBT exemption, lower fuel costs, and pre-tax salary deductions under a novated lease.
By contrast, the hybrid (HEV) and petrol models cost around $130 more per fortnight in out-of-pocket expenses, making the PHEV a far more cost-effective option in the short and long term.
PHEVs Offer the Best of Both Worlds
A Plug-in Hybrid Electric Vehicle (PHEV) offers the ability to drive short distances in full electric mode while retaining the flexibility of a petrol engine for longer trips. With many PHEVs now offering 50-100km of electric range, daily commutes can be completed on electricity alone, drastically reducing fuel expenses.
Unlike full battery electric vehicles (BEVs), PHEVs do not require public charging networks—they can simply be plugged into a standard power outlet at home overnight.
Why You Need to Secure a PHEV Now
- Limited Stock Availability – With demand surging before the FBT exemption ends, PHEV stock is expected to sell out fast.
- Massive Savings on Novated Leasing – You could save over $42,000 compared to petrol or hybrid options.
- Lock in Lower Running Costs – The FBT exemption reduces your out-of-pocket expenses significantly.
- Future-Proof Your Investment – Enjoy the benefits of electric driving without the range anxiety of full EVs.
Don’t Wait—Get a Quote Today!
With March 31, 2025, fast approaching, buyers looking to secure maximum financial benefits on a PHEV novated lease must act quickly.
Want to see how much you could save? Get in touch with Paywise today for a personalised novated lease quote and secure your PHEV before the tax breaks disappear!