Novated Lease EV or Toyota Hybrid

focus123 on 01/09/2025 - 14:19
Last edited 01/09/2025 - 16:55

Looking for some thoughts on vehicle ownership options for my next role.

Daily commute: ~40km round trip (city/metro drive, morning and evening traffic, 5days a week)

Annual travel: ~10,000 km (city driving)

Pre-tax income: $130,000

I’ve learned that EV novated leases are fully pre-tax (FBT exempt), which makes them attractive for salary packaging. I’ve also included some Toyota hybrids (Corolla Cross, Yaris Cross, RAV4) because of their strong resale value.

👉 Please ignore Elon’s politics and Australia-China geopolitics — I’m only after feedback on economic value, ride safety, and comfort.

EV Options

BYD Atto 3

  • Price: $42,000

  • Retained value (4 yrs): $21,000 (50%)

  • Weekly novated lease: $185

  • Residual: $15,750

  • Equity: $5,250

  • 4yr cost (after-tax): $18,223

BYD Sealion 7

  • Price: $58,000

  • Retained value (4 yrs): $29,000 (50%)

  • Weekly novated lease: $239

  • Residual: $21,750

  • Equity: $7,250

  • 4yr cost (after-tax): $23,075

Tesla Model Y

  • Price: $64,000

  • Retained value (4 yrs): $35,000 (55%)

  • Weekly novated lease: $258

  • Residual: $24,000

  • Equity: $11,000

  • 4yr cost (after-tax): $21,536

Hybrid Options

Toyota RAV4 Hybrid GX

  • Price: $50,000

  • Retained value (4 yrs): $37,500 (75%)

  • Weekly novated lease: $278

  • Residual: $18,750

  • Equity: $18,750

  • 4yr cost (after-tax): $26,822

Toyota Yaris Cross Hybrid GX

  • Price: $36,000

  • Retained value (4 yrs): $29,000 (80%)

  • Weekly novated lease: $194

  • Residual: $13,500

  • Equity: $15,500

  • 4yr cost (after-tax): $16,538

Toyota Corolla Cross Hybrid GX

  • Price: $42,000

  • Retained value (4 yrs): $33,600 (80%)

  • Weekly novated lease: $239

  • Residual: $15,750

  • Equity: $17,850

  • 4yr cost (after-tax): $21,284

Used Car Option

Toyota Camry Hybrid (2012–2013)

  • Purchase: $14,000

  • Sale after 4 yrs: $9,000

  • Running costs:

  • Fuel: $1,200/yr

  • Service: $500/yr

  • Rego: $700/yr

  • Insurance: $1,200/yr

  • 4-yr running total: $14,400

  • Plus $1,000 (tyres & battery) + $1,000 (unforeseen)

  • Total 4-yr ownership: $21,400

Edit: I added the total after-tax ownership cost as it helps identify the impact on our take-home salary. Model Y shows surprisingly good value there when compared to the base model Corolla Cross.

Poll Options

  • 15
    BYD Atto 3
  • 68
    BYD Sealion 7
  • 104
    Tesla Model Y
  • 6
    Toyota RAV4 Hybrid GX
  • 1
    Toyota Yaris Cross Hybrid GX
  • 3
    Toyota Corolla Cross Hybrid GX
  • 6
    Toyota Camry Hybrid (used : 2012–2013)
Automotive BYD Auto Car Novated Lease SUV Tesla Inc Toyota Electric Vehicle

Comments

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  • changyang1230 on 02/09/2025 - 12:53
    +19

    At the risk of sounding like a shameless self promoter, I would like to share the free spreadsheet tool helps you crunch these numbers in significant detail and solid accuracy. It models the cashflow, asset and liability over a 5-year horizon. and even simulates how varying offset balances over time affect your home loan interest in each scenario.

    https://www.reddit.com/r/AusFinance/s/VHJ25VpNKu

    As already pointed out by a few of us, another great option is an FBT-exempt novated lease of a USED EV (any EV first held and used after 1/7/22, and have never paid luxury car tax). So do make sure you consider those as well.

    • Nalar on 02/09/2025 - 13:56
      +5

      a real hero enters the chat…

    • muzzamo on 03/09/2025 - 13:27
      +1

      You are a legend - that spreadsheet helped me make the decision!

      The one thing I missed - despite your spreadsheet - was the pros and cons of 1+1+1 lease vs 3 year lease. I went 3 years but probably should have done 1+1+1 for more workplace flexibility.

      • changyang1230 on 03/09/2025 - 18:40
        +1

        Hey thanks.

        Yeah the long lease vs multiple shorter lease choices. It’s a tough one and I try not to delve into that too much as it could very easily fall into “financial advice” area which could land me in trouble.

        Definitely pros and cons to each choice.

  • andresampras on 01/09/2025 - 18:17
    +11

    The answer is:
    1. go sit in all of them
    2. test drive the ones you like the most.
    3. factor in the costs you've calculated above (with grains of salt), and choose the one that you would like to drive on a daily basis.

    Numbers don't tell the whole story.

  • hmac on 01/09/2025 - 15:49
    +6

    After 4 years, I don't think you will be selling a 17 year old camry for 9k, probably a lot closer to 5K or lower. Also 14K is a bit rich but hey market has changed

    • focus123 on 01/09/2025 - 16:04

      agree, the used car market is still distorted from Covid era shortage and it gotten worse with the high influx of migrants and students who usually buy the vehicles that are nearing the end of their life. But yes in 4 year the demand will not be the same as there are many new brands in the market.

  • [Deactivated] on 01/09/2025 - 14:24
    +5

    bike

    • focus123 on 01/09/2025 - 14:28
      +7

      Thanks, the travel route doesn't have dedicated bike lanes, and heavy B-Doubles are always present. So bike is not a good option for this use case.

      • Dr Phil on 02/09/2025 - 20:34
        -3

        Dear focus123

        Since you will be driving the car its best if you take each car for a test drive first.
        Do your in-depth research. Maybe see what cracker deals you can negotiate.
        Then decide

        It matters not what anyone says here as its based on thier personal opinion, own unique circumstances and on thier own values, beliefs.and priorities. These are most likely different to yours and no 2 people are the same.

        So get a piece of paper

        Write down whats important to you
        Put a value against each one
        Then apply these values to each vehicle in your shortlist and give each car a score.
        But like I said, take each one for a test drive FIRST as you will quickly knock out most on your list.

  • mboy on 01/09/2025 - 14:31
    +5

    I'm not doubting the Toyotas you've mentioned will retain their value much better than the EV's, but I reckon the 20-25% depreciation after 4 years is pretty optimistic. How'd you land on those numbers?

    • JimB on 01/09/2025 - 14:46
      +1

      Using Covid residuals.

    • focus123 on 01/09/2025 - 14:49

      I had a look at the current driveaway price using the Toyota customise calculator, and got Dealers' "before driveaway" prices listed on CarSales for 4-year-old Toyota hybrids with less than 60,000km in South Australia. I think limiting the search to SA may have shown higher prices as SA prices are traditionally higher for 2nd hand cars due to low supply.
      The SA vehicle fleet is the 2nd oldest in Australia after Tasmania.

      • mboy on 01/09/2025 - 15:03
        +4

        Well if you're indeed in SA then it's consistent with your circumstances, but I’d still lean a bit more conservative on those Toyota depreciation figures.

        • focus123 on 01/09/2025 - 15:13

          Thanks, Yes, Toyota jacked up the prices of their entire range by about 10% or so that helped used Toyotas to retain value better. But with easing supply chain issues and more competition from china, it is sensible to shave 5-10% more from expected retained value in 4 years time.

          • pwnd on 04/09/2025 - 10:02

            @focus123: If you do go down the Rav4 route, factor in the fact the new model is coming out next year, which will mean that the older shape Rav will have a bigger depreciation hit.

  • tasbargains on 01/09/2025 - 17:07
    +5

    The EV lease FBT exemption is a deal a bit of a too good to be true, so it's certainly something to act on now if you are interested in switching to an EV. The suggestion in the comments here to lease a post-2022 eligible used EV isn't a bad one.

    I think it's also obviously not true that ICE resale values will continue as they have been, because the market is still distorted by factors like Covid lead time delays and some price stickiness, but this simply will not last. The EV transition will absolutely happen quite quickly, now that cars better than their ICE equivalents are widely available at comparable prices. Government policy will get sharper, because after electricity, passenger and light commercial vehicles are the next-lowest hanging fruit. So I wouldn't be betting on some magic no-depreciation Toyota come the early 2030s.

    • focus123 on 01/09/2025 - 17:15

      True, the government incentive is a game changer, I would not even consider an EV if there was no FBT exemption.
      Toyota has entered the EV game with Bz4x and has completely moved the small passenger vehicles segment to Hybrids. If they keep increasing the "Toyota tax" they will surely lose the market share as there are other players who are willing to cut the price and fill the gap.

  • kaboom mel on 03/09/2025 - 17:44
    +4

    I have now learnt to think that cars will have not any retain value in 10 years.

    I bought a 125K BMW X5 10 years ago, always serviced with the BMW dealer. spent 25K in repairs along the way and now the car needs fixing and I am told by BMW it is not worth fixing it as I will be paying the current value of the car to fix it. So it will likely go to the wreckers or trade in for whatever I can get for it.
    So essentially I have paid between 125K-160K to drive the car for 10 years. I was under the impression that cars , specially European ones last long but that's not the case anymore.

    Buy the car thinking till you drive to ground in 5-10 years think its value will be zero then. I am applying this to new EV I am looking to get. Drive till it dies or tech gets older or you get bored for it and expect it being nothing at the end of it. Anything you get for it treat is a bonus

    • SetTheFaqUp on 03/09/2025 - 18:55

      My 6 year old Lexus is still going strong with not even a squeak.

      The Mazda ND and of a similar vintage and good as new.

      Evolve X coming close 10 years. Not major repair to-date.

      • whyisave on 04/09/2025 - 15:45

        Any timing belt changes at 100K km ?

        • SetTheFaqUp on 04/09/2025 - 15:57
          +1

          Most cars are well under 100km. Lexus being the highest, hitting 60k km. Timing chain in the 2GR will see it far beyond 100k km.

          Whilst other are low mileage, the cars are pretty well stressed on track days. Full flush after each event.

          I would think dumping 25k on our of routine repair in the first ten years of ownership is crazy. Nothing but poor engineering/QC.

          The only questionable one is the Boxster, it can't run away from the fate of being a VW and uses a freakin plastic impeller.

    • andyfc on 03/09/2025 - 21:10

      specially European ones last long but that's not the case anymore.

      You're about 40 years out of date on that assumption.

    • whyisave on 04/09/2025 - 13:35

      The car is a typical 'sunk cost', ie. it won't recoup its purchase price, let alone the growing running/maintenance costs, however no CGT applies to them, when you sell them !

      Then, considering an EU brand/model…you start swearing at yourself, at how/why these EU designed cars are even allowed to be sold, due to the way it fails and the costs of repairing,
      eg. power-steering motor on the whole steering shaft (ie. you have to replace the whole shaft and cannot just replace the motor), etc.

      I really think those EU manufacturers pay someone to work out the longevity of a part, and then tell them how to make that part fail within 3-5 years. It's like they bake in a particular failure-rate into a car's components, just to be able to milk the consumer via repairs.

      PS:
      In your X5, did you have
      _ sunroof failures?
      _ 'gear-box' failure, eg. the stick would not register "[P]arking" and "[D]riving"?
      _ power-steering failures?

      • kaboom mel on 08/09/2025 - 22:11
        +1

        Yes the first 5 years were a breeze. The car was under warranty and had no issues what so ever. I also got 5 year service plan for it. I was their advocate initially. As per your point, things started to fall apart around the 6-7 year mark. And at 10 year, the value to fix the car is worth its market price.

        I didn't have any of the failures you mentioned. my big expense came with the DPS filter change, oil leakage and an issue with the turbo.
        And now I have to change the timing chain which is in X5 needs the whole engine to be taken out to do. So not a fun job for anyone.

        I feel they are designed badly to not optimise repair costs. One simple example I remember, i had to change the wiper blades on the car, I couldn't just change the rubber like in other cars. I had to replace the whole wiper with the plastic attachment which was around $400 (each or both can't remember now). Just added complexity to make money and get you to buy genuine parts rather than third party options.

  • dasher86 on 01/09/2025 - 14:42
    +3

    What about a used BYD Atto 3 2023 ($30-35k)
    Large $10-15k depreciation already mostly eaten up.

    • changyang1230 on 01/09/2025 - 14:44
      +6

      Second this. A used EV which is eligible for FBT-exempt novated lease is by far the best value.

      • kiitos on 02/09/2025 - 07:53

        I didn't think the FBT exemption could carry over if it was sold?

        • changyang1230 on 02/09/2025 - 10:58
          +3

          Not exactly sure what you mean by "carry over FBT exemption".

          What I mean is - if you find an EV which is first used and held after 1/7/22, and has never paid luxury car tax throughout its history, then you can definitely do FBT-exempt novated lease on it as per ATO rules.

          https://www.ato.gov.au/businesses-and-organisations/hiring-a…

          • kaboom mel on 03/09/2025 - 17:31

            @changyang1230: I thought the car had to be new or deal demo to qualify .

            It also says so in the eligibility criteria "the first time the car is both held and used is on or after 1 July 2022"

            • changyang1230 on 03/09/2025 - 18:30

              @kaboom mel: That’s precisely the rule - the car just has to be first used and held after 1/7/22. It does not have to be new. A used car that was first held and used on 1/11/22 would do it. (EV, no LCT ever too)

    • focus123 on 15/10/2025 - 08:16
      +1

      @dasher86 , @changyang1230, Thanks for your suggestions. I finally went down the used EV path. Found a 2023 MG ZS EV Excite with 15000km for $24,000 driveaway at one of the local MG dealers(5 years of manufacturer warranty remaining).
      Paid cash as I haven't finished the probation period to apply for a novated lease. Probably I will convert it into a novated lease after probation, as it is still eligible for EV FBT exemption.

      • dasher86 on 15/10/2025 - 08:32

        I would have recommended any EV except the MG ZS EV though.
        But can't lose at that price.

    • focus123 on 01/09/2025 - 17:18

      Thanks, will keep this option in mind. I still did not find a calculator for used car leases.

      • dasher86 on 01/09/2025 - 18:14
        +1

        Basically the same except that there might not be gst on purchase is some cases.

      • OldSchoolHarry on 04/09/2025 - 14:27

        Try Autopia. You can manually input car purchase price.

  • apple2016 on 01/09/2025 - 16:02
    +3

    where do you get the retained values from?
    This can vary a lot based on conditions. If Petrol prices doubles, ICE cars values will plummet. On the other hand if EV battery tech improves, existing Ev's values will drop a lot…
    I dont think you can use it as a valid comparison point.

    • focus123 on 01/09/2025 - 16:05

      I had a look at the current driveaway price using the Toyota customise calculator, and got Dealers' "before driveaway" prices listed on CarSales for 4-year-old Toyota hybrids with less than 60,000km in South Australia. I think limiting the search to SA may have shown higher prices as SA prices are traditionally higher for 2nd hand cars due to low supply.
      The SA vehicle fleet is the 2nd oldest in Australia after Tasmania.

  • netjock on 01/09/2025 - 16:19
    +3

    Total cost of ownership is the number you need to work out

  • rambutann on 01/09/2025 - 20:12
    +2

    To answer the overarching question - yes you should get an EV on a novated lease. My recommendation is that you get a Geely EX5. What you get for the price is incredible. The only reason why you wouldn’t do it is if the range wasnt going to cut the mustard, but you’ll be fine - also once you own an EV you realise you dont need as much range as you thought.

    I have recently reviewed my household vehicle setup, i currently have a Polestar 2 (on a novated lease), a clapped out landcruiser on club plates and a motorbike.

    I was reviewing my options assuming i get rid of the cruiser and motorbike and replace it with one vehicle. I concluded the Geely EX5 (more expensive option) was the best option for me. Far cheaper over a 5 year period than spending $10k on a bog standard vehicle with regular fuel consumption and regular levels of maintenance post tax.

    Before i purchased the polestar i got a quote on a toyota corolla cross hybrid on a novated lease, a $48k car at the time - the polestar was way cheaper because of the FBT exemption.

  • FlyingMiffy on 02/09/2025 - 21:56
    +2

    Making assumptions about the retained value of a depreciating asset is not the brightest idea… if you are considering a novated lease, what you should focus on is the residual i.e. how much you still owe after the leasing terms and use that as a risk comparison.

  • lordofdestruction on 03/09/2025 - 12:11
    +2

    Model y, you will love the car and its tech. Make sure to to test drives .

  • focus123 on 15/10/2025 - 08:20
    +2

    For those that followed the discussion on this thread. Below is the final outcome for me.
    I finally went down the used EV path. Found a 2023 MG ZS EV Excite with 15000km for $24,000 driveaway at one of the local MG dealers(5 years of manufacturer warranty remaining).
    Paid cash as I haven't finished the probation period to apply for a novated lease. Probably, I will convert it into a novated lease after probation, as it is still eligible for EV FBT exemption.

    • SetTheFaqUp on 22/10/2025 - 15:53

      That's cheap. Nice one.

  • djesr on 01/09/2025 - 16:38
    +1

    Has anyone done a NL calculation for doing 1yr lease periods, as the second 1yr lease will be on the residual amount and the highest depreciation is in the first fe years

    • Inertia-g on 02/09/2025 - 07:50
      +1

      I’ve had mixed advice (and experience) with this.

      One NL company said that even if you extend the lease, the depreciation is based off original purchase, but that is not how it has worked out for me in reality. I did a 2 year lease, then changed leasing companies (fortunate that my company offers 3 options), and have gone for an additional 1 year. The lease repayments are about the same, but the residual is massively lower, as you have suggested.

      I can see the reasoning for long leases in an ICE vehicle - to amortise the maintenance costs, but as that is not required in an EV, doing shorter leases makes more sense and gives greater flexibility

      • changyang1230 on 02/09/2025 - 11:05
        +5

        The residual value is set by ATO as 65.63% at 1 year, 56.25% at 2 years, 46.88% at 3 years, 37.50% at 4 years and 28.13% at 5 years.

        Even when you do a repeated lease of say 1+1+1, at the end of that third year, the residual value is to be 46.88% of the original car value, instead of 65.63%^3 = 28.27% of the original car value.

        The ATO made this explicit in Taxation Determination TD 93/142 (issued in 1993). For example, in Example 3 of the ruling:

        A car with an effective life of 8 years is acquired after 30 June 2018 and leased for a period of 1 year. At the conclusion of that lease, a new lease is entered for 2 years. Using the 8-year effective life column in the table in paragraph 3 of this Determination and the total leased period of 3 years, the minimum residual value will be 46.88% of the cost of the car. The table applies the same irrespective of whether the car is leased through the same leasing company or another leasing company.

        https://www.ato.gov.au/law/view/document?docid=TXD/TD93142/N…

        Despite this unambiguous guidance, more than 30 years later some companies still attempt to apply the 65.63% rate repeatedly, which is plainly incorrect. In practice, this area remains poorly audited and lightly regulated, so such practices often go unchecked. Nonetheless, the law is crystal clear: repeating the 65.63% figure contravenes TD 93/142 and amounts to obtaining an unlawful financial advantage.

        • Inertia-g on 02/09/2025 - 11:16

          @changyang1230 do you know how it (should) work in practice when buying a second hand car on a novated lease? Should the residual still be based of the original purchase price when new?

          • changyang1230 on 02/09/2025 - 12:03
            +1

            @Inertia-g: This TD does not really talk about what the calculation is if your leased item is used in the first place. So no, I am not entirely sure. I think if it was a simple purchase then it would probably start from 65.63% at 12 months after your starting point; however if you got the EV from someone who already had it under NL during their time, I don't know if they have to follow this TD93/142 method.

            • WhyAmICommenting on 02/09/2025 - 23:43
              +1

              @changyang1230: Hey man, still loving my MG4 - that was such a steal on the lease. Cheers!

            • Poor Ass on 03/09/2025 - 11:22
              +1

              @changyang1230: What do you do for work and why you know so much about novated leases?

              Agree that effective life residual % based is never really enforced when it comes to 1+1+1+1+1 stacks… no one actually checks

              There are also so much grey areas too

              The NL companies can request the financier to adjust the RV lower than the ATO's rates if the vehicle is driving excessively but what this does is increase the salary sacrifice amount which is good if you are trying to reduce tax and pay less residual. In practice this can be done, but most NL companies just stick with the ATO's rates to avoid future issues. I mean if a car is driving 100000km is not going be worth 65.63% of the value vs a car doing 10000km a year. So there are set ATO RV rates but there is also the justifiable rates that the financier gets told to use.

              Depending on the NL company and financier, some may do vehicles pass 10 years beyond the 8 but when they do they don't care about the effective life they just use 65.63% for 1 year leases every time. It depends on what the least amount of finance both parties are willing to write and the lowest I've seen is $4000 and 12 year old used car. There's no law about how old or value a novated lease vehicle can be so it's up to the financier to take on that risk if they accept.

              • changyang1230 on 03/09/2025 - 18:31
                +2

                @Poor Ass: I’m a nerdy doctor who first looked into NL for myself and in the process got into the rabbit hole and developed the spreadsheet calculator which I then shared with the world.

                Essentially a nerd’s niche interest gone too far lol.

                • Poor Ass on 03/09/2025 - 23:13

                  @changyang1230: Haha now I know why you are looking at 1 year lease … Too much income cumming out of ya ass need to reduce that shit

                  • changyang1230 on 04/09/2025 - 00:15
                    +1

                    @Poor Ass: Nah I never looked into 1 year leases seriously myself.

                    My leasing company is the honest one who immediately pointed me to the TD93/142 and told me "other dodgy companies do it but our financier wouldn't allow it".

                    This was when I was first considering the pros and cons of various durations. I ended up with a 5-year as I was worried about the 2027 exemption ending. And I have pretty little worry about job security as an employee in public sector. But I suppose I could have looked into 3+3 or something but I was a bit sick of handling the red tapes (the first time I approached HR to sign off the deed of novation, it was in a hidden building in the hospital behind a locked corridor with no one answering my knock lol)

                    • whyisave on 04/09/2025 - 08:35

                      @changyang1230:

                      about the 2027 exemption ending

                      which exemption is this ?
                      (is this the FBT exemption?)

                      EDIT:
                      I saw your post here,
                      that explains it.

                    • Poor Ass on 04/09/2025 - 10:08

                      @changyang1230: without revealing the NL company, what financier was that followed the ato RV rule?

                      • changyang1230 on 04/09/2025 - 12:46

                        @Poor Ass: Challenger bank which is not really a well known name.

                        • Poor Ass on 04/09/2025 - 13:44

                          @changyang1230: wonder if any relation to Challenger retirement income provider

                          or Gladiators tv show…. Challenger are you ready?

      • djesr on 02/09/2025 - 09:29

        Yes, I agree. I'm still not 100% sure but I believe overall the best option is to go 1yr leases, but I think the monthly payment is higher for 1yr leases

    • kaboom mel on 03/09/2025 - 17:38

      Won't a long term lease like a 5 year lease make sense? I mean what are the reasons you will prefer a short term lease . Yes your depreciation is highest in 1st year but then no advantage is stopping there. You can still continue to claim (smaller) depreciation and still paying pre-tax dollars and can also claim all the running costs - rego/insurance/maintance through that.

      I am buying a car this month and going through the same exercise, so keen to know.

      thanks

      • Poor Ass on 03/09/2025 - 23:12
        +1

        Short term good if you are one highest tax bracket required maximum reduction in gross income lowering income tax

        If you keep re-leasing year by year you also get to buy a very cheap car at the end

        Long term good to avoid paperwork and have a more spread out of expenses / tax savings. Good if you are in stable job industry.

        No one lease term suits everyone each person's circumstance is different
        There's no

        • kaboom mel on 04/09/2025 - 09:34

          I am in the highest tax bracket salaried employee, so as per this it will be better to do 1 year lease. But when what should i do the second year - pay/financial the residual and keep the car or get another novated lease? if i get another novated lease, then as per the ATO rules, the depreciation is pre-set so i don't get any benefit in renewing or taking out a longer lease.

          And if i am paying the residual and buying the car, then i lose tax benefits on the ongoing costs of the car - service, maintenance etc . Plus assuming i have to finance the residual and want keep the car, then i am not paying those re-payments pre-tax

          • Poor Ass on 04/09/2025 - 10:01

            @kaboom mel: good to know rich guy

            if you are liking your car and plan to keep it for a decent amount of time you don't actually need to pay off the residual at maturity

            what you would do is re-lease or refinance the residual amount when it matures for another 1 year that way you keep all your benefits and pay the lease payments at a lower price

            mind you that re-leasing year by year is only good if you are trying to reduce maximum amount of tax and buy out a car for cheap in a short amount of years

            so in a way you need to consider how long you intend to keep the car and this can be hard but that way you can plan how long you would like to lease the car for to get the max savings

            • kaboom mel on 04/09/2025 - 16:36

              @Poor Ass: Thank you for your patience and advice

              So base assumption is -
              - I plan to keep the car for long, 5-10 years.
              - Goal with NL is tax minimisation.
              - I also will likely finance the residual if its >30K.

              So, assuming the car is 100K (i know LCT is 91odd K but going with this number for simplicity's sake)

              Now assuming I go for 1 year NL, Residual after 1 year will be 65.63% or ~65K. I will get the maximum tax benefit in the 1st year, whihc is great. Now at the end of year 1 - i can refinance the residual or lease. I think it will make sense to re-lease for another year again due to FBT and able to pay rego/insurance/Maintenace etc via it.

              At the end of Year 2 the residual will 56.25% of the original value - 56K. I will only get 10% deprecation in year 2. My year 3 will start with 56K and go down to 46.88K

              Which will be the same as if i just did 3 years to begin with. Please ignore my stupidly, I not able to understand the difference between leasing 1 year at a time for 3 years vs leasing right away for 3 years.

              • Poor Ass on 04/09/2025 - 23:44

                @kaboom mel: Do you work for a for profit organisation? If so you'll need to pay luxury car adjustment on top of the contributions which can be done in pre tax if you are doing a car beyond the depreciation limit

                That TD93/142 is never followed by the financier or NL provider. Only chanyang got a really odd financier. 99% of the time if you say nothing you will they will give you 65% residual and then another 65% and so on. Based on a 100k car you can do 5x1year leases. Maybe a 6th if ya nl provider is flexible on the finance <10k

                • changyang1230 on 05/09/2025 - 00:17

                  @Poor Ass: Are your confident that TD 93/142 is ignored by most companies?

                  In whirlpool forum discussions, most people state that this is followed.

                  • Poor Ass on 05/09/2025 - 11:01

                    @changyang1230: Most do

                    But depends who you get

                    All the ones I've dealt with don't care they just do 65% residual for 1 yr leases

                    How else will you do the residual for cars older than 8 years old. Just the same residual % based on the lease term

                • kaboom mel on 05/09/2025 - 09:03

                  @Poor Ass: Yes i work for a corportate. The 100K was just an example, my car will be around 90K so just below the LCT so i don't believe i have to may any luxury car adjustments.

                  I am not confident my company's NL providers SGFleet / Orix will do 5x1 lease. i would love to but these i expect these companies have high volumes and hence prefer sticking by the book. but i will check anyway.

                  Thanks a lot

                  • Poor Ass on 05/09/2025 - 10:52

                    @kaboom mel: Depends on the car.. you getting EV?

                    You don't need to decide if they can do 5x1years you just need to ask if I got on 1 year lease how many times I can re-lease it

                    It's the high volumes that would do it compare to the little ones actually

                    Sg fleet will do it.. Orix just sucks all up

                    • kaboom mel on 08/09/2025 - 21:59

                      @Poor Ass: yes I am getting an EV and will be under the LCT to qualify of the FBT exemption. Otherwise I would have just financed it.

                      I called up Orix and they said they can renew the lease each year but there is no benefit, as in they follow the schedule as the the ATO. I will give SG Fleet a call and see what they say.

                      I have to say I last time I the best rate from Orix but their customer service sucks big time

                      • Poor Ass on 09/09/2025 - 07:19

                        @kaboom mel: Well if I was on your income I would open up a company and buy the EV since it also would be exempt as well and more in control but that requires some expertise. I would even do the NL.

                        Now with Orix did you ask the right question? Did you ask them if I re-lease with year by year for let's say 5 years because you want to salary sacrifice the most to reduce your take home pay. What is the residual amount that would be applied for each year

                        All NL follow the ATO residual rate but they might be following the set year rate not considering the age of the car.

                        Btw year by year is always the most expensive so you do save more tax compared to e.g 5 years. Some NL apply interest rate based on length and some apply based on amount.

                        So there's a difference but up to you to ask

                        Orix and SG fleet both suck tbh. Never have a seen a quote that wasn't a rip off. Need to aim for an effective rate of around 7%

                        • kaboom mel on 09/09/2025 - 11:14

                          @Poor Ass: -> Well if I was on your income I would open up a company and buy the EV since it also would be exempt as well and more in control but that requires some expertise. I would even do the NL.

                          Yes and comes withsome overheads around fixing tax etc. plus i was told NL need a company to show revenue for 12 months before they will sign up. Something i will certainly look into for my second car , which i am planning to get in next 6 months

                          ->Now with Orix did you ask the right question? Did you ask them if I re-lease with year by year for let's say 5 years because you want to salary sacrifice the most to reduce your take home pay. What is the residual amount that would be applied for each year

                          Yes i did ask them if i can do a new lease every year. They said no i can't but i can renew the lease but they said there is no benefit in doing that vs taking a lease upfront. i will ask again to a different person to see i get a different answer. It might be the corporate contract they have which mandates this. The year on year looks defintely like the best option for the tax saving but i am not able to get one.

                          ->Orix and SG fleet both suck tbh. Never have a seen a quote that wasn't a rip off. Need to aim for an effective rate of around 7%

                          Unfortunately, i have to go with only one these and i am getting around early 7s for the effective rate.

      • changyang1230 on 04/09/2025 - 01:46
        +1

        On top of what poor ass said, a big point of contention is the potential for FBT-exemption goodness to come to an end during the mid-2027 review.

        By tradition, typically preexisting arrangement eg a 5-year lease from 2025 to 2030 will be allowed to run its original course even if they decide to remove the exemption in 2027; however if you do the repeated 1+1+1 etc, you might be out of luck if you have a lease that runs from September 2026 to September 2027, and in July 2027 they simply call a stop to everything.

        • Poor Ass on 04/09/2025 - 10:06

          yes this is true

          but back when I was working during when you had to meet certain travel to avoid a FBT liability due to sufficient post-tax they had a grandfather system where they got 1 year after it finish to reap the benefits.

          Also for businesses that have a company car using for private purposes with no changes in financial circumstance, they got to keep the very low rate of 7% post-tax if driving 40000km…. I actually know some people that are still on 7% FBT and those are rare

          So yes anything can happen with the FBT exemption. Maybe the guy can do 1+0.5+5 haha… that's what a lot of people did before FBT related rules got phased out

  • Dollar General on 02/09/2025 - 07:58
    +1

    There are loads of BYD’s still in their novated lease periods and when the lease expires, they will flood the market. Expect the retained value after 4 years to be closer to 25% if you’re lucky

  • eddyah on 03/09/2025 - 14:17
    +1

    HOW HAS NOBODY ASKED

    CAN YOU CHARGE AT HOME OP???!?!?!?!

    • acersaurus on 03/09/2025 - 16:04

      OP has a daily commute of 40km and drives 10,000km a year. OP is a good candidate for the standard granny charger so long as OP is within reasonable distance to a fast charger in the event that OP needed to drive somewhere far away and didn't have the range.

      • eddyah on 03/09/2025 - 19:15

        OP never mentioned if he's got the home charging sorted or if it'll cost him $2K extra to wire it + pass strata etc if they're in an apartment.

        EVs are great when you can plug in when you get home and be ready to go the next day. They can cause hardship and haters when you're relying on public charging and you rock up to one and it's full / out of service.

        • focus123 on 04/09/2025 - 12:22

          I am thinking of standard wall plug charge as I only travel Less than 50km per day. Not intending to install a fast charger at home as slow charger can cover my daily usage, and I can top up any gaps on sunny weekends when my 5KW solar system is producing enough electricity.

          • eddyah on 04/09/2025 - 14:45

            @focus123: If you can charge at home, definitely get an EV.

            Go second hand if you don't want the depreciation hit.

            Otherwise, buy new for the latest and greatest tech

  • Hardlyworkin on 03/09/2025 - 18:17
    +1

    We went with a Kia EV3 on a novated lease with solar at home. Noting that it wasn't necessarily the best financial cost though happy with the decision. Brand loyalty to Kia also played a part after previous good experiences.

    • hothed on 04/09/2025 - 10:32
      +1

      EV3 is a fantastic EV platform. Good choice!

  • sghetti on 04/09/2025 - 11:31
    +1

    I'm currently heading down the same path. I have a 4x4 and do caravanning occasionally, did a lot of research and making a switch to a tent, self-inflating mattresses and sleeping bags for camping. I was on the lookout for a new car, my car has given me a fair bit of grief with ongoing repairs mostly inside warranty, but it's now a year out of warranty. Alternator packed up and some other oil leak issues that I've had repaired twice within 4 years already, bit over it.

    I drove a Tesla Model Y (probably around the 2022-23 model) while on a short holiday in QLD and fell in love with it. Explored Novated Leasing and for my use case, it works out perfectly. My main reason is to get car warranty again and move on the somewhat of a lemon I have now. Factoring in all current onroad costs for my current car (not taking into account probably $2k of repairs per year I could be spending ongoing) the Novated Lease costs me about $560 per month.

    I won't see the cost savings from onroad costs over the Novated Lease of 5 years, I've budgeted for my current costs over that period. But I get new car warranty coverage and a much better overall experience IMO. Taking out my current onroad costs already budgeted for, selling my current 4x4 and caravan will basically cover the rest (repayments and balloon payment at the end). I'll have that cash sitting up my sleeve to cover the repayments practically upfront.

    My plan is to hold onto the car at the end of the 5 years, but who knows where I'll be at that point and whether I just continue to renew a lease. I could certainly be financially better off just getting a used car that could cover my use cases well enough, but my current experiences with a car out of warranty has been well short of average.

    • Euphemistic on 04/09/2025 - 12:28

      What 4x4 is it? An alternator failing isnt uncommon, nor a deal breaker for most owners. Its just a pain in the bum til it gets fixed.

      • sghetti on 04/09/2025 - 13:08

        2019 Ford Ranger, 2nd hand around 2.5 years old. Right off the bat an oil leak, timing cover needed re-sealing. Sorted that in warranty, then it happened a year later. Fixed again under warranty.

        Then 6 months later aircon was leaking, that was the worst one, aircon was stuffed for most of summer, dealer and ford couldn’t come to an agreement and almost required the whole dash to be pulled apart for a basic couple of rubber rings. Finally got sorted after 3 visits to the service centre.

        Then about 6-12 months later the upper boost pipe exploded, limped around while waiting for a new one, DPF got completely clogged in the meantime.

        Lastly the alternator back in April, battery was stuffed too. Oh and the timing cover is leaking… again for the 3rd time since ownership

        • Euphemistic on 04/09/2025 - 13:19

          Yeah. Thats not a good run. Ive had a 2007 navara since 2017 has 240k km on it and its had less issues. Alternator, wheel bearings clutch and a tailshaft joint has been about it.

          • sghetti on 04/09/2025 - 13:51

            @Euphemistic: It hasn’t been a good run at all. My worst experience with a car, rarely had issues with previous ones, even a Craptiva.

            Some of it is it’ll be my first brand new car, but this Ranger is a ticking timebomb with the amount of issues it’s had. The timing cover fix is around $1500-2000 afaik if they don’t cover it. I’ll argue that it was never fixed properly and that it’s a known fault in these engines. Was told that by a dealer mechanic, 2.0l bi-turbo’s on the rangers and everests are known to have this problem.

            Also looking for a bit of a change from the large Ute. Caravanning has been fun, but also annoying with maintenance and storage etc. I’m planning an Easter trip to The Grampians. Should be able to do a tent and all the other things in the Model Y. With a short charging trip in Bordertown from Adelaide to get me through.

  • MS Paint on 01/09/2025 - 15:48

    Tesla Model Y
    Price: $64,000
    Retained value (4 yrs): $35,000 (55%)

    Tell him he's dreaming. Workmate just finished up a 3 year lease on a Y and is $10k out of pocket to payout the lease from best sale offer price. $10k buys a metric shit tonne of petrol. FFS

    • focus123 on 01/09/2025 - 16:00
      +7

      yes it could be true as some of the early high-end Model Ys had RRP of around $100k.
      In the past 2 years, Tesla has cut the price of Model Y aggressively to face the competition from Chinese and Korean EVs. Unfortunately, the early buyers had to face non-ideal depreciation on their asset because of that.

      • MS Paint on 01/09/2025 - 16:09
        +5

        That's exactly what happened. Purchased at the peak
        then Elon slashed prices to remain competitive. Nothing to suggest this trend won't continue though likely it will be less aggressive.

        • grocerygetter on 03/09/2025 - 07:21
          +1

          Sorry what?

          I was one of the earliest buyers at $74220 in July 2022.

          My car has just come off lease and my Payout is $27899 (incl GST)

          Model Ys are selling for way more than $27899 so I don’t understand how you’d be out of pocket…

          • MS Paint on 03/09/2025 - 09:41

            @grocerygetter: I'll ask for more details next time I'm working with him.

            Was your lease 3 years, 46.88% residual?

            • grocerygetter on 03/09/2025 - 16:52

              @MS Paint: 37.6%

              Because I did a one year lease and then a subsequent 2 years

              • focus123 on 03/09/2025 - 18:05

                @grocerygetter: @grocerygetter did you get any benefit by doing the lease in 2 steps?

              • MS Paint on 03/09/2025 - 18:24
                -1

                @grocerygetter: That's probably the difference. Pretty sure he had a fair bit tied up in expensive options as well.

        • safrane on 02/09/2025 - 11:46

          I don't think many Tesla buyers thought that Elon would cut prices so aggressively, because that will absolutely damage the brand as Tesla owners get hosed in the resale market. But he did and with the recent politics, plus future RUCs on EVs makes Tesla resale values are in uncertain territory. Many Tesla owners today would not be buying Teslas if they had known about all this beforehand.

          When NZ introduced RUCs it absolutely cratered the EV market, because the most efficient hybrids (aka JDM Toyota Prius Cs badged as Aquas) are everywhere and available cheaply, and their fuel savings meant that they pay less in road tax per KM than an EV, especially in urban environments.

          With EVs you're always playing a long game with government policy and international (more specifically Chinese) trade policies, and market dynamics in response to that. For example what if Trump tells Albanese to stop importing cars from China, or the US will slap 100% tariffs on Aussie goods?

          Whereas there's always a decent (maybe not great, but OK) market for a good Toyota, for the next 10 years at least.

          Of course there could be a major war in the Middle East and petrol prices may spiral out of control, but looking at recent events post-initial Ukraine invasion, the oil market has been very reluctant to go on a hyper-cycle because demand has been softening, partly because of China's economy, partly because of US shale, and partly because of EVs.

          And then there's also the issue of electricity and home solar - if you can make it work.

      • MrThing on 03/09/2025 - 19:02
        -3

        old shit box model Ys

    • mboy on 01/09/2025 - 15:56
      +4

      Sounds like your workmate had the same mentality as a lot of people leasing EV's during peak covid, which was that they could lease a car and then cut a profit.

    • supersabroso on 01/09/2025 - 19:01
      +3

      I don't know where your numbers came from for the hybrid cars but they should be a lot more expensive due to the FBT being applicable for the EVs only. The novated lease costs I got for a $64k EV was about $47k over 5 years + the residual compared to a $44k hybrid car which costs $56k/5 years + the residual. It should be a no brainer to go for the EV car. Having said that you also need to consider quality and running costs, the BYD Sealion 7 will be $1.8k in insurance vs $3k/year for the Tesla Model Y. The Sealion 7 is also more luxurious compared to all the hybrid Toyota GX models which are a joke. You need to be looking at the Cruizer model ($56k) to get close to the luxury built into the Sealion 7.

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