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40% of Aussies say they’d get an Electric car (EV) if subsidies assisted the initial purchase price*. Furthermore, thanks to generous new legislation, electric car novated leasing has become a more affordable option for businesses looking to offer sustainable transport options to their employees. In addition, a workplace benefit called novated leasing enables employees to lease a car using their pre-tax and after-tax income, potentially offering big savings. Today we’ll explore the benefits of Novated leasing Electric cars and how businesses can stand out by offering this benefit.
Why Novated leasing an electric car is a smart choice
Electric vehicles offer several advantages over traditional petrol or diesel vehicles when it comes to novated leasing. Firstly, EVs have lower running costs, making them an attractive option for both employees and businesses. We spoke to Melbourne driver Danny, who recently purchased a Tesla Model 3 through a Flare novated lease, about how his running costs have reduced thanks to his new vehicle. Secondly, EVs produce fewer emissions than petrol or diesel vehicles, helping businesses to reduce their carbon footprint.
According to the Electric Vehicle Council, the number of EVs on Australian roads has doubled in 2022 with more than 83,000 EVs currently on the road**, and this trend is likely to continue as the cost of EVs decreases and the availability of charging infrastructure improves.
3 ways your business can stand out by offering Novated leasing with electric cars
Attract and retain talent
Offering novated leasing on electric vehicles (EVs) can help businesses differentiate themselves from their competitors. It can also provide sustainable transport options for its employees, thereby increasing employee satisfaction and retention. Recent analysis from Deloitte found that nearly 2 in 5 Gen Z and millennials have rejected a job or assignment based on their personal ethics. So, by offering an employee benefit that supports their values, businesses can tap into the preferences of the next generation of workers who are increasingly interested in environmentally responsible employers.
Demonstrate support for employees’ financial wellbeing
EVs have lower running costs than petrol or diesel vehicles, which can save employees money in the long run. This is because EVs have fewer moving parts, require less maintenance, and have no fuel costs. Novated leasing provides employees with a cost-effective way to finance a car through pre-and-post-tax salary deductions, which could help alleviate the financial burden of purchasing a car, especially in the current cost of living crisis.
Demonstrate environmental responsibility
By offering novated leasing on EVs, businesses can demonstrate their commitment to sustainability and reducing their carbon footprint. This can be an important factor for customers and investors who are increasingly looking for environmentally responsible businesses to support.
Attract and retain top talent with novated leasing Electric cars
Electric vehicle and plug-in hybrid adoption in Australia is set to explode. With the introduction of no Fringe Benefit Tax (FBT) tax for eligible electric vehicles through a novated lease arrangement, these vehicles are more accessible than ever. For businesses, this is a significant opportunity to offer considerable tax savings to attract, engage and retain staff, while also taking a leadership position on sustainability. At no cost to your business.
- Meet the demand for EVs 40% of Aussies say they’d buy an EV if subsidies assisted the initial purchase price. With the introduction of no FBT on eligible EVs and PHEVs only through a novated lease, employees will be seeking employers who proactively offer this benefit.
- Give your employees’ salaries a boost, at no cost With no FBT on eligible EVs and PHEVs, you could save your employees on average $9k per year at no cost to your business.***
- Simplify your balance sheet with no FBT With no FBT to pay on eligible EVs and PHEVs, simplifying your balance sheet.
- Take leadership on sustainability You’ll be leading the transition to EVs, and demonstrating innovation and a commitment to sustainability.
**https://electricvehiclecouncil.com.au/2022-australian-electric-vehicle-industry-recap/
***Flare comparison data between ICE Mazda CX5 vs. EV Tesla Model 3 on 50 month lease term, 15,000kms pa
