Australians are snapping up used electric vehicles at record pace, and for good reason. With fuel prices biting harder than ever, the shift to electric is no longer just an environmental choice; it's a financial one. But here's what many buyers don't realise: you don't have to buy a used EV outright to access one. A novated lease on a used electric car could save you significantly more, and the process is simpler than you think with Remunerator.
Why Used Electric Cars Are in Demand Right Now
The numbers tell the story. Ross Booth, Data Services Director at Carsales, Australia's biggest marketplace for new and used vehicles, confirms the surge: "Searches for EVs on our site jumped more than 280 per cent month-on-month in March and were up nearly 465 per cent year-on-year."
At the auction end of the market, demand is just as fierce. "The number of bidders bidding on used EVs is up 40 per cent," says Brendon Green, General Manager at major car auction house Pickles.
With petrol prices remaining elevated and energy costs front of mind, used EVs offer a compelling combination of lower running costs and a more accessible price point than brand-new models. Add a novated lease into the equation, and the savings stack up even further.
What Is a Novated Lease on a Used Electric Car?
A novated lease is a three-way agreement between you, your employer, and Remunerator. Your employer deducts lease payments directly from your pre-tax salary, reducing your taxable income, and therefore the tax you pay.
Novated leasing isn't limited to new cars. You can novate a used electric vehicle and enjoy the same core tax benefits. That means you could get behind the wheel of a quality second-hand EV while keeping more money in your pocket every pay.
The Electric Car Discount: A Game-Changer for Used EVs
One of the biggest financial advantages of novating an electric car is access to the Electric Car Discount. Under this federal government policy, eligible battery electric vehicles (BEVs) are exempt from Fringe Benefits Tax (FBT), a tax that normally applies to employer-provided vehicles.
Removing FBT entirely can save you thousands of dollars each year.
To be eligible for the FBT exemption on a used EV, the vehicle must:
- Be an electric car
- Have a value below the luxury car tax threshold at the time it was first sold as a new vehicle (currently $91,387 for fuel-efficient vehicles in 2025–26)
- First held on or after 1 July 2022
- Be used by a current employee (you) and provided through a valid novated lease arrangement
The good news: many popular used EVs like the Tesla Model 3, Hyundai IONIQ 5, Kia EV6, and BYD Atto 3 all fall well within this threshold, making them excellent candidates for an FBT-exempt novated lease.
What You Must Consider Before Novating a Used EV
Buying or leasing a used electric vehicle requires a little more due diligence than a standard used car. Here's what to check before you sign:
1. Battery Health and Range
The battery is the most critical and expensive component in any EV. Ask for a battery health report. A degraded battery means reduced range and potential replacement costs down the track. Most manufacturers provide tools or certified inspections that show state of health (SOH) as a percentage.
2. Remaining Warranty
Check whether the vehicle's original manufacturer warranty and specifically the battery warranty is still active and transferable. Many EVs come with 8-year or 160,000 km battery warranties, which can transfer to subsequent owners.
3. Charging Compatibility
Make sure the used EV you're considering is compatible with the charging infrastructure in your area and at your home. Check whether DC fast charging is supported, and factor in the cost of installing a home charger if you don't already have one.
4. Service History
A full service history gives you confidence the vehicle has been maintained correctly. For EVs, this means software updates have been applied and any recalls actioned.
5. Vehicle Age and Lease Term
Remunerator can finance used vehicles up to a certain age typically no older than 15 years at the end of the lease term. Confirm the vehicle you've chosen meets our eligibility criteria before falling in love with a particular model.
6. Residual Value
At the end of a novated lease, you'll need to pay a residual value (balloon payment) or refinance. Ensure the residual is set correctly for a used vehicle, as it will differ from a new car.
The Benefits of Novating a Used Electric Car
Here's a summary of why a novated lease on a used EV is one of the smartest financial moves you can make right now:
Pre-Tax Savings
Lease payments, running costs (including registration, insurance, servicing, and charging) are all bundled into your salary package and paid from pre-tax income. This reduces your taxable income, meaning you pay less income tax.
FBT Exemption
Eligible used EVs attract zero Fringe Benefits Tax under the Electric Car Discount, eliminating what is normally the most significant cost of a novated lease.
Lower Purchase Price, Same Tax Efficiency
Used EVs cost less than new ones. That means a lower lease cost while still enjoying the same pre-tax and FBT benefits. It's a double win.
Fuel Savings
Charging an EV costs a fraction of what you'd spend on petrol. With home charging rates and smart charging schedules, many drivers spend less than $5 to travel 100 km compared to $15–$20 in a comparable petrol vehicle.
One Simple Fortnightly Payment
Running costs are bundled into a single payment deducted from your salary. No surprise rego bills or service invoices, it's all taken care of.
GST Savings
You save on GST on all your running costs. Additional savings your hip pocket will appreciate.
How to Novate a Used Electric Car: Step by Step
Step 1: Check Your Employer Offers Novated Leasing
Novated leasing requires your employer's participation. Most medium-to-large employers already offer this as part of their salary packaging benefits. Check with your HR or payroll team.
Step 2: Choose Your Used EV
Browse used EV listings on platforms like Carsales, Drive, or CarExpert. Shortlist vehicles that meet the FBT exemption criteria and your budget. Don't forget to factor in the vehicle's age relative to your intended lease term.
Step 3: Get a Quote
Contact Remunerator and request a quote based on your chosen vehicle, your salary, and your preferred lease term (typically 1–5 years). The quote will show your estimated fortnightly cost and tax savings.
Step 4: Conduct a Pre-Purchase Inspection
Before committing, arrange an independent inspection from a certified mechanic with EV experience. Request a battery health report and verify the vehicle's history through a PPSR check.
Step 5: Approval and Settlement
Remunerator will handle the purchase of the vehicle, registration, and insurance setup. Once approved, your employer begins deducting your lease payments from your pre-tax salary.
Step 6: Drive and Save
Hit the road and enjoy the savings every pay cycle.
Frequently Asked Questions
Can I novate any used electric car?
Most battery electric vehicles are eligible for FBT exemption under the Electric Car Discount, provided their original sale price was below the luxury car tax threshold. Remunerator can confirm eligibility for a specific vehicle.
How old can a used EV be for a novated lease?
This varies and is dependent on your car, but generally cars can be no more than 15 years old at the end of the lease term. A 5-year-old EV on a 3-year lease, for example, would typically be fine.
What happens at the end of the lease?
At the end of the lease, you can pay the residual to take ownership, refinance your residual/extend your lease, or start a new lease on a different vehicle.
What happens if I change jobs?
Novated leases are tied to your employment. If you change jobs, you may be able to continue the lease with your new employer, pay it out, or refinance. Remunerator will walk you through your options.
Ready to Get Started?
The surge in used EV demand is showing no signs of slowing. The combination of lower vehicle prices, rising fuel costs, and the federal government's FBT exemption for electric cars has created a rare opportunity, and a novated lease puts it within reach on a tax-effective basis.
Remunerator specialises in helping drivers across Australia secure their used electric car with maximum savings and minimum hassle. Our team handles everything from checking your chosen vehicle's eligibility, to structuring your lease for the best possible tax outcome.
Get in touch today to find out exactly how much you could save novating a used EV. Your next car might cost you a lot less than you think.