If you're close to deciding on an EV novated lease, timing matters more right now than it usually would. Leases signed before 1 April 2027 keep the full FBT exemption for their entire term, even as the rules tighten for anyone who signs after that date. Here's how to think about whether that's worth acting on.
What "locked in for the term" actually means
The phase-down applies based on when you sign, not when your lease happens to be running. Sign now, and your lease keeps its full exemption for the whole term you agreed to: three years, five years, whatever you choose. That holds regardless of what the rules look like for new leases signed after you. Wait until after 1 April 2027, and your lease is priced under the reduced-exemption rules from day one.
When locking in early is worth it
- You're already planning to get an EV soon. If the decision is "when," not "if," signing before the cutoff is close to a free option: you get the better rate for a decision you were going to make anyway.
- Your EV is priced above $75,000. This is where the timing decision matters most in dollar terms: Phase 2 drops your exemption from 100% to 25% specifically because of the price, and locking in beforehand avoids that entirely for the life of the lease.
- You're planning a longer lease term. The exemption gap compounds over more years, so the value of locking in the better rate is larger the longer your term.
When there's genuinely no rush
If your EV is priced at $75,000 or under, Phase 2 doesn't touch you: you keep the full exemption whether you sign now or in 2028. There's no urgency premium to manufacture here: a sub-$75k EV is in the same position under Phase 1 and Phase 2 alike. The only real cutoff that matters for that price band is Phase 3, in April 2029.
Our calculator shows the actual dollar difference across all three phases for your salary, your EV, and your term, not a generic estimate.
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