Luxury Car Novated Lease
Novated leasing makes luxury cars, especially EVs under the Luxury Car Tax threshold, cheaper through salary sacrifice, GST exemption and bundled pre-tax running costs.
Less tax, more car
If you’re eyeing a luxury vehicle and assume novated leasing is for cheaper cars, you’re mistaken. Luxury cars are great to salary-sacrifice since they can reduce your taxable income by thousands of dollars per year, depending on your tax bracket. Even if a luxury car tax applies at purchase, your five-year lease savings can typically exceed what you’d pay upfront.
Add in GST exemptions and bundled running costs, and suddenly car ownership can actually work smarter for your take-home pay.
What luxury car brands can get on a novated lease?
All of them. Whether you’re leaning towards European engineering, Japanese reliability or cutting-edge electric performance, novated leasing is available across the entire luxury market, including:
European Luxury Car Brands
Japanese Luxury Car Brands
While EVs under the Luxury Car Tax threshold deliver maximum tax savings through FBT exemption, luxury petrol and hybrid models can still deliver substantial savings through salary sacrifice.
Is a novated lease worth it for high-income earners?
Absolutely. When your pre-tax income covers your lease and running costs, your money works smarter.
The example assumes a $150,000 salary, BMW IX1, 5-year lease, 15,000km/year, 80% business use:
- Annual tax saving: $12,498
- Weekly payment: $297
- Total 5-year benefit: $62,490
Compare that to traditional finance on a similar SUV, and you’re driving a premium, electric vehicle for comparable monthly payments. For luxury vehicles, especially eligible EVs under the $91,661 threshold, the savings are unbelievable.
Want to see how your numbers stack up? Use our novated lease calculator and preferred model to see personalised numbers or read our luxury car novated lease guide.
How does Luxury Car Tax affect a novated lease?
Technically, it doesn’t. Whether you buy outright, take a traditional loan, or use a novated lease, LCT applies the same way at purchase.
What is the Luxury Car Tax?
Luxury car tax (LCT) is charged at 33% on every dollar your vehicle's value exceeds $91,661.
But novated leasing will always come out on top
- Salary sacrifice lets your pre-tax income cover your vehicle costs.
- GST exemptions save up to 10% on purchase price upfront.
- Bundled running costs paid pre-tax amplify the benefit further.
- For eligible EVs: FBT exemption means 100% of payments come pre-tax.
If you have questions, you can call us at any time on 1300 888 594 or send us a message
Get behind the wheel of your dream luxury car
We're all about education at Leaselab. We’ll show you exactly how much a luxury vehicle costs on a novated lease and what you'll actually save.
See your estimated numbers
Use our calculator – Enter your salary, preferred model and lease term. Get your weekly payment and total savings in a few minutes.
Personalised Guidance
Request a Quote – Our team reviews your situation and shows exactly what your luxury car costs on a novated lease.
Speak to Someone
Call 1300 888 594 – Talk to our team about your luxury car options and how much you'll actually save.
Our Happy Customers
We’re committed to providing great service
Your own consultant
They look after you from first quote to the end of your lease. Kept in-house, and never pushy about it.
Fast, from start to finish
From quote to keys in days, not weeks. We move quickly so you can get on the road sooner. Subject to vehicle availability and financier approval timelines.
Approval timing depends on your financier and borrowing capacity. Reported timelines from Trustpilot reviews, July 2026.
Frequently Asked Questions
Does a novated lease reduce taxable income?
The answer is a resounding yes. When you salary sacrifice your car payments and running costs, they're deducted from your pre-tax income before tax is calculated. This reduces your taxable income by the amount you're sacrificing.
The tax saving depends on your marginal tax rate, but most earners save thousands per year. This applies to all novated leases, not just luxury cars, which is why it's such an effective strategy regardless of the vehicle you choose.
Does a novated lease reduce luxury car tax?
No. LCT applies at purchase regardless of finance method. However, novated lease tax savings through salary sacrifice typically exceed the LCT cost over your lease term, which can be a very enticing proposition for high earners.
Are there income limits on getting a novated lease?
No. Approval depends on borrowing capacity relative to your income. High earners can benefit because salary sacrifice delivers larger absolute savings, though any PAYG employee can qualify if they meet lender requirements.
Which luxury EVs qualify for FBT exemption?
The following luxury EV variants currently qualify for FBT exemption:
- BMW: IX1 eDrive20, IX1 eDrive30, IX3 M Sport, i4 eDrive 35
- Lexus: UX 300e Luxury, UX 300e Sports Luxury
- Mercedes: EQA, EQB
- Volvo: EX30 Extended Plus, EX30 Extended Ultra, EX30 Performance Ultra, EX40
This means 100% of your lease comes from pre-tax salary, meaning you can leverage the maximum tax savings available.
These are vehicles with an estimated cost below the luxury car tax threshold, as at August 2026. On-road costs, such as dealer delivery, standard and statutory warranties, accessories, modifications and treatments to the car before it's delivered, may impact the cost for the purpose of working out luxury car tax, according to the ATO.
What happens if a luxury car exceeds the LCT threshold?
You still get substantial novated lease tax savings through salary sacrifice and running cost bundling. However, you lose the FBT exemption benefit available to EVs under the threshold.
Use our novated lease calculator to compare the real monthly cost difference.
Learning Hub
Consider these resources a preview of the deep knowledge and service you can expect from us
Say goodbye to confusion and hello to a seamless novated car leasing experience
Want a no-hassle novated lease? Think Leaselab for your next car. Smaller tax bill. Bigger savings. No surprises.
