What Cars are Eligible for a Novated Lease?
Novated leasing brings alot of flexibility in your car choice. Whether you're looking to salary package a new, used, or even your current car, there are options for you.
Which Cars are Eligible for a Novated Lease?
Choose from New, Used, or your Own.
One of the biggest advantages of novated leasing is flexibility. Whether you’re looking for a brand-new car, a quality used vehicle, or even want to salary package your existing car, there are options to cover anyones needs.
New Cars
With Clear Lease negotiating the purchase, many drivers get access to special Fleet discounts and full manufacturer warranties with this option.
The most commonly novated new cars are EV's, given that they are 100% pre-tax and offer the largest tax savings.
Used Cars
With used cars, the key requirement is that the vehicle meets age and financing criteria - typically, it shouldn’t be older than 12 years at the end of your lease term.
This option can be a smart way to access novated leasing benefits while really reducing the finance amount, by getting a vehicle at a steal of a price because it's already left the dealership.
Your Current Car
You can novate your existing vehicle by refinancing it under a novated lease structure. The equity you have in your car becomes a potential cash lump sum, and the refinanced amount and runnings costs start getting paid pre-tax.
This lets you get the benefits of salary packaging on your current car.
Which Cars Are Not Eligible?
While novated leasing offers plenty of flexibility, there are some clear rules around what cars can’t be leased. Primarily, it comes down to the estimated depreciation, and legal definitions of 'cars'.
Very old vehicles
The occasional exception can be made for prestigious cars that can hold their value much longer.
Vehicles over a certain mileage
Unregistered or unroadworthy vehicles
Privately imported vehicles
Commercial or modified vehicles
Motorcycles
Browse Options by car
Get inspired with the most popular novated lease deals
From sleek sedans to rugged utes - check out the cars our drivers have been loving most this year.
Tesla Model Y
Nissan Leaf
BYD Shark 6
BYD Seal
Mercedes-Benz EQB250+
Mazda CX-5 Sport
Mercedes-Benz EQE300
Tesla Model Y
Isuzu D-Max X-Terrain
Mitsubishi Outlander PHEV
Polestar 3
Hyundai Tucson Hybrid
Ford Ranger XL
Tesla Model 3
Mercedes-Benz EQE350
Mercedes-Benz EQA250+
Polestar 2
BYD Sealion 6
BMW i4 eDrive35
Types of Novated Leases
Novated leases come in two main types: Fully-maintained and Self-managed. In our experience, Fully-maintained is by far the most common, but some opt for self-management.
1. Fully Maintained
It's by far the most popular option at Clear Lease, and 95% of our drivers opt for it.
Fully maintained with Clear Lease is usually the ideal choice (for most), thanks to its simplicity and convenience. It takes all of the tax learning, effort, documentation, and forward planning out of your hands and lets us take care of it.
With a Fully Maintained lease, you also pay one fixed cost each pay cycle for everything, and it even accounts for predicted repairs at regular intervals. Whether it's accessing our fleet pricing or special interest rates, it’s a hands-off option that frees you up to focus on just the best Novated benefits.
2. Self-Managed
Why would some people opt for self managed?
A lot of other Novated Leasing providers will force you to use their preferred financier who has a high interest rate, or say you cannot pick your own mechanics/service centres unless you go self-managed, which is why this method has gained some popularity.
At Clear Lease, we work with a range of lenders and let you choose your preferred providers if you wish. That's why almost all of our drivers just go fully-maintained.
If you’re the type of person who enjoys getting hands-on with every part of the process, and wants to do their own learning, this option might still be better for you. For most, it requires too much forward planning and effort.
How a Novated Lease Works:
Novated Leasing is a form of salary packaging, where your employer agrees to turn part of your pay in to a benefit, like a car. Instead of paying with your after-tax wages (like with a traditional loan), your employer pays for all of this with your pre-tax dollars, boosting your take-home pay by 10-30% without changing your salary.
With Clear Lease, a percentage of your car expenses (fuel, maintenance, insurance) is deducted from your salary before tax. If you drive an EV, you can even pay 100% of your car costs pre-tax, making it an even bigger win.
Without a Novated Lease:
With Clear Lease:
Frequently Asked Questions:
The Luxury Car Charge is a salary deduction used to offset the extra tax your employer pays when you lease a car above the ATO’s luxury car depreciation limit. It helps them recover the shortfall from reduced tax deductions.
Please note, this is completely separate from the Luxury Car Tax (LCT).
FBT is a tax (with a rate at 47%) applied to fringe benefits (incentives beyond salary/wages received from an employer). A non-electric car under a novated lease is a fringe benefit (electric cars are completely FBT exempt in Australia).
The employer is responsible for paying the FBT, but at Clear Lease - we use the employee contribution method (contributing post-tax funds) to offset any FBT to zero.
Our regular novated lease package (fully-maintained) usually includes your car lease repayments, fuel/charging, servicing, maintenance & repairs, registration, insurance, and tyres - all bundled into a single pre-tax deduction.
Yes, but it’s treated as a financial termination. You'll need to pay out the remaining lease value (and any fees), and you may lose some tax benefits. Talk to us to get a payout quote from your financier.
No, when your employer leases the car, they claim the GST credit, meaning you don’t pay GST on the purchase price. The same applies to most running costs. You will, however, pay GST if you buy the car at lease end.
Yes, if you’d like to keep the car, you simply pay the residual value set at the beginning of the lease. You can pay this from your personal funds, or refinance it separately. Once paid, the car is yours. You can also sell or trade it in and start a new lease.
Yes, if your new employer supports novated leasing, you can transfer your lease by signing a new agreement. If they don’t, you’ll need to make private repayments, refinance, or consider ending the lease.
Your lease doesn’t end if you change jobs. You can either transfer it to your new employer, pay privately until the lease ends, or choose to end the lease early.
Cars that are too old, unroadworthy, imported, heavily modified, or intended for commercial use typically don’t qualify for novated leasing. Motorcycles are also excluded under current ATO guidelines.
Luxury Car Tax (LCT) applies to vehicles that exceed the government’s set price thresholds. For the 2024–25 year, it’s $76,950 for standard vehicles and $89,332 for fuel-efficient ones. If your lease includes a car above these values, LCT may be added to your lease costs.
Please note: This is very different to the Luxury Car Charge (LCC).
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