How to Check a Novated Lease Quote in Australia: A Line-by-Line Guide for EV Buyers

To check a novated lease quote, ignore the headline “savings” figure and test five numbers instead: the financed amount, the residual, the effective interest rate, the running-cost budgets and the fees. If each one can be explained in writing, the quote is probably fair. If one of them can’t, that’s where the provider’s margin is hiding.

A novated lease is a three-way agreement between you, your employer and a finance company. Your employer pays for the car from your pre-tax salary. For electric cars it’s usually the cheapest way to buy, because an eligible EV is exempt from fringe benefits tax (FBT). That exemption is why providers can show large savings, and why a padded quote can still look like a bargain.

The trouble is that a novated lease quote bundles finance, fees, insurance and running costs into a single fortnightly deduction. Buyers posting quotes for checking in September 2026 kept running into the same problems: brokerage folded into the price, deferred payments nobody explained, and budgets set too low to be real. This guide goes through a quote line by line.

How to check a novated lease quote: the five numbers that matter

Every novated lease quote can be broken into five parts, and each has a simple test.

Quote line	What to check	Red flag
Financed amount	Drive-away price minus the GST credit, plus named fees	A gap of more than a few hundred dollars that nobody can explain
Residual	ATO minimum percentage for your term	Residual that doesn’t match the ATO table, or GST treatment not stated
Interest rate	Effective rate from a calculator vs the quoted rate	Effective rate more than about 1 percentage point above the quoted rate
Running-cost budgets	Insurance, tyres, servicing, rego, charging	Budgets well below your own quotes
Fees	Management, establishment, procurement, termination	Fees mentioned on the phone but missing from the written quote

Only one of these is fixed for the whole lease: the finance payment. It’s set by the financed amount, the rate, the term and the residual. Everything else in your deduction is a budget, and budgets can be adjusted. That’s why the finance side deserves most of your attention.

Start with the vehicle price and financed amount

The financed amount should be the car’s drive-away price minus the GST credit, plus any fees you can name. Under a novated lease the financier claims the GST on the car’s purchase price, so you don’t finance it (ATO). That credit is capped at one-eleventh of the car limit. For 2026 to 2027 the car limit is $69,883, so the most GST that can come off is $6,353 (ATO).

Do the maths yourself. Take the drive-away price, subtract the GST credit, and compare the result with the financed amount on your quote. The difference should be explained by items you recognise.

Here’s what a gap looks like in practice. One BYD Dolphin quote shared for checking this month listed the car at $24,843 excluding GST. Working back from the lease payments and residual showed about $26,919 was being financed. That left roughly $2,075 unaccounted for. Some of it was likely a setup fee, but the quote didn’t say how much was brokerage.

Two items commonly sit in that gap:

Brokerage. Brokerage is a commission the provider earns for arranging the finance, and it’s often rolled into the amount you borrow. It isn’t always shown as a separate line. Ask directly: “How much brokerage is included in the financed amount?”

Procurement fees. Some providers charge a fee, often a few hundred dollars, for sourcing the car on your behalf. If you’ve already negotiated a price with the dealer, ask for this fee to be removed. On brands sold at fixed prices, such as Tesla, the provider can’t negotiate a better deal than you can, so the fee buys you little.

Ask the dealer for their own drive-away price before you ask for a quote. That gives you a benchmark the provider can’t blur.

Check the residual against the ATO table

The residual is the lump sum you owe at the end of the lease, and the ATO sets the minimum for each term. A novated lease must leave a residual, sometimes called a balloon payment, to be treated as a lease rather than a loan for tax purposes. These are the ATO minimum residual values (ATO car leasing and FBT):

Lease term	Minimum residual (% of the car’s cost)
1 year	65.63%
2 years	56.25%
3 years	46.88%
4 years	37.50%
5 years	28.13%

Two checks matter here. First, confirm the percentage matches your term. Second, check whether the residual on your quote includes GST. It’s calculated on the car’s cost to the financier, which excludes GST, but many quotes show the figure including GST because that’s what you’ll pay at the end. Neither is wrong, but you can’t compare two quotes unless you know which is which.

A higher residual makes each payment smaller but leaves a bigger bill at the end. Our guide to novated lease residual values covers what happens when the lease finishes and whether to pay out, refinance or trade in.

Work out the real interest rate

The rate printed on a quote is rarely the full cost of the finance. Work out the effective interest rate yourself from four numbers: the financed amount, the lease payment, the term and the residual. Any lease calculator, including our novated lease calculator, will do it.

If your result is close to the quoted rate, the finance is priced as advertised. If it’s well above, look for one of two causes.

Money added to the financed amount. Brokerage and setup fees rolled into the loan raise the true cost without changing the headline rate. One buyer comparing two Dolphin quotes this month found the lower headline rate was the worse deal once a $1,600 setup fee was added to the loan.

Deferred payments. Some providers start deducting from your pay for a month or two before the first finance payment, to build up a balance in your lease account. Interest keeps accruing during that gap, and the loan is repaid over fewer payments. In the Dolphin quote above, a two-month deferral turned a finance rate of about 9.9 percent into a true cost of about 12.2 percent over three years, because only 34 of the 36 months carried payments. You’d usually only spot this after the lease starts, in your transaction history. Ask before you sign: “Are any payments deferred, and for how long?”

There’s a third risk if the car is months away. Buyers who signed in mid-2026 and waited for delivery have reported their rate rising before settlement, which they put down to lenders lifting rates in September. That’s usually allowed by a clause in the agreement. Ask whether the quoted rate is locked until delivery, and get the answer in writing.

As a rough guide, effective rates on EV quotes buyers shared for checking in September 2026 mostly landed between about 8.5 and 10 percent, with three-year terms at the higher end. Our guide to novated lease interest rates shows the calculation step by step.

Test the running-cost budgets

Running-cost budgets should match what the car will actually cost, not what makes the fortnightly figure look good. A novated lease quote usually includes budgets for insurance, registration, tyres, servicing and charging. Money you pay into these budgets comes from pre-tax salary, which is where much of the saving comes from.

Budgets that are too low are the common trap. A quote with $1,000 a year for comprehensive insurance on a new EV should raise eyebrows. So should a single set of tyres over five years on a heavy, powerful SUV. If the budget runs out, you pay the shortfall, and some providers invoice it with short notice. Get your own insurance quote and set the budget from that.

Budgets that are too high carry a smaller cost. Unused money isn’t lost. At the end of the lease, or when you leave your employer, the surplus is paid back through payroll as ordinary taxable income. What you can’t do is put that surplus toward the residual.

Two EV-specific points are worth checking:

No post-tax contribution. The employee contribution method (ECM) is a way of paying part of a lease from after-tax income to reduce fringe benefits tax. An eligible EV is FBT-exempt, so there’s nothing to reduce and no post-tax payment is needed. If an EV quote shows a post-tax deduction, ask why.

Home charging. Providers can reimburse home charging using the ATO’s EV home charging rate, which rose to 5.47 cents per kilometre from 1 April 2026. Check that the charging budget reflects your kilometres and whether you’re charging at home or on public networks.

Fees that don’t show on the first page

Most novated lease fees are small on their own and large across five years. Ask for a written list of every fee, including the ones that only apply if something changes. Our novated lease hidden costs guide covers the full list, but these are the ones to check on any quote:

• Management or administration fee. Charged every pay period or month for running the lease. It varies by employer, because employers negotiate their own agreements with providers.
• Establishment fee. A one-off charge at the start, sometimes rolled into the loan.
• Procurement fee. For sourcing the car. Ask for it to be removed if you deal with the dealer yourself.
• Early termination fee. Charged if the lease ends early. SG Fleet, for example, lists $660 including GST, on top of the remaining payments and the residual.

The 2027 FBT change: check the car’s value

From 1 April 2027 the EV tax exemption starts to wind back, and the car’s value on your quote decides how you’re affected. Today, electric cars priced under the $91,661 luxury car tax threshold for fuel-efficient vehicles are fully exempt from FBT for 2026 to 2027 (ATO). The May 2026 Budget announced a phased change (Treasury ministers’ release, 5 May 2026):

• Leases that start before 1 April 2027 keep the full exemption for the life of the lease.
• From 1 April 2027, only EVs valued at $75,000 or less stay fully exempt. Those above $75,000 get a 25 percent FBT discount instead.
• From 1 April 2029, every eligible EV moves to the 25 percent discount.

Treasury released exposure draft legislation in September 2026. It isn’t law yet.

For a quote, this means two things. Check the base value your provider uses for the car, because options and delivery charges can push a car priced just under $75,000 over the line. The Tesla Model Y L, at $74,900 before on-roads, is the obvious example, and our Model Y L review looks at it in detail. And if you might change jobs during the lease, read our guide to changing jobs with a novated lease, since a new employer may count as a new arrangement after April 2027.

When a novated lease quote is good enough to sign

A novated lease quote is good enough to sign when every number above can be explained and no competing quote beats it. You don’t need the lowest rate in the country. You need a quote with no unexplained money in it.

Novated leasing is now a mainstream way to buy a car. The industry body NALSPA estimates more than 500,000 Australians have a novated lease (ABC, April 2026). Treasury’s review found nearly 100,000 people had used the EV exemption by late 2025, mostly through novated leases. Providers compete for that business, even when it doesn’t feel like it.

If your employer uses one provider, you can still negotiate. Buyers report that brokerage and procurement fees come down when asked, even where the provider has an exclusive arrangement. Insurance is the other lever: bring your own policy if it’s cheaper.

If you have a choice, get at least two quotes on the same car, term and kilometres, and compare the effective rate and total fees, not the fortnightly deduction.

If your partner’s employer offers novated leasing, their provider may price better. Think about which of you is more likely to change jobs or take leave during the lease, because the lease follows the employee.

One last check is whether a lease suits your plans at all. A novated lease is a financial commitment, and lenders count it when you apply for a home loan. If you’re planning to borrow in the next few years, weigh that alongside the tax saving. For everything else about EV novated leasing, start at our EV novated leasing hub or browse electric vehicles under the FBT threshold.