Why buyers of premium electric cars face an April 2027 deadline

Novated leasing specialists and automotive advisors have issued fresh reminders to prospective car buyers this week, urging anyone considering a higher-spec electric vehicle to factor in delivery lead times ahead of proposed fringe benefits tax adjustments.

Under transitional rules announced following the Federal Government's review of the Electric Car Discount, the rules governing novated EV leases are set to tighten in two separate stages.

How the rules will change

Until 31 March 2027, the current electric vehicle discount settings remain fully operational. Any battery electric vehicle priced below the fuel-efficient luxury car tax threshold—set at $91,661 for the 2026–27 financial year—can qualify for a 100 per cent FBT exemption.

From 1 April 2027, the rules begin to narrow:

• Electric cars priced at $75,000 or under will keep their full 100 per cent FBT exemption until 31 March 2029, before shifting to an ongoing 25 per cent discount.
• Electric cars priced between $75,000 and the luxury car tax cap will drop from a full exemption to a 25 per cent discount on payable FBT from 1 April 2027.
• From 1 April 2029, the full exemption ends entirely, with all qualifying EVs below the threshold receiving an ongoing 25 per cent FBT reduction.

Crucially, agreements established prior to 1 April 2027 are protected under grandfathering provisions. Drivers who enter into a novated lease before that date retain their full FBT exemption for the entire agreed term of the lease.

Why timing matters now

While April 2027 sounds distant, novated lease providers point out that vehicle delivery schedules can take anywhere from three to six months for popular trims, optional extras and bespoke factory orders.

Because eligibility depends on when the lease commences and when the employer makes the vehicle available to the driver, delivery delays could easily push an order placed late next year past the cutoff date. Multiple popular dual-motor models and higher-grade trims hover right around the $75,000 mark, where adding a premium paint colour or larger wheels can push the invoice into the higher bracket.

What this means for your novated lease

• Check your vehicle's price bracket: If your preferred EV sits below $75,000, you have plenty of breathing room, as the 100 per cent exemption remains in place for another two years.
• Targeting an EV between $75,000 and $91,661? To secure the full FBT exemption for three to five years, your lease needs to be operational before 1 April 2027. Factoring in delivery waitlists means planning your purchase sooner rather than later.
• Existing leases remain safe: If you already have an EV on salary packaging, these upcoming thresholds will not alter your current tax treatment.
• Consider trims and options carefully: Small changes to specification can make a substantial difference to whether a car falls above or below the $75,000 boundary.