A small handful of submissions so far. Worth a read if you are interested.
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Labor Electric Car FBT discount
- Thread starter ENORYM
- Start date
Priit
Active Member
I read through the submissions and I tend to agree with much in them. I would also like to see another addition to the law, but am not really legally savvy, so hope that someone thinks of this and sends a submission for themA small handful of submissions so far. Worth a read if you are interested.
When I spoke to my employer about ending my current Tesla Model 3 novated lease early and getting a new one to save on FBT and they said their contract with the novated lease company has been amended and now they cannot purchase cars that cost over government set Car Depreciation Limit that is around $64k this year and is inclusive of stamp duty.
So it would be nice to amend that new EV legislation and add a clause to the legislation that amends the Car Depreciation Limit bringing that limit for zero emissions vehicles to the same level as LCT, this would greatly increase the available options for companies that have similar limit as my employer. And this would likely increase the ZEV uptake because of the extra vehicles the businesses could fit under that limitation.
I have always entered into novated lease arrangements where it is me (the employee) who takes out the finance lease on a vehicle not the employer. The lease can then be novated between me, my employer and a salary packaging company (in one case we didn't bother with a salary packaging company). Are you able to do it that way rather than your employer purchasing a car?I read through the submissions and I tend to agree with much in them. I would also like to see another addition to the law, but am not really legally savvy, so hope that someone thinks of this and sends a submission for them
When I spoke to my employer about ending my current Tesla Model 3 novated lease early and getting a new one to save on FBT and they said their contract with the novated lease company has been amended and now they cannot purchase cars that cost over government set Car Depreciation Limit that is around $64k this year and is inclusive of stamp duty.
So it would be nice to amend that new EV legislation and add a clause to the legislation that amends the Car Depreciation Limit bringing that limit for zero emissions vehicles to the same level as LCT, this would greatly increase the available options for companies that have similar limit as my employer. And this would likely increase the ZEV uptake because of the extra vehicles the businesses could fit under that limitation.
Interestingly one of the submissions proposes to restrict the exemption to only new vehicles, with the view that in a couple years time a lot of new EV purchasers will be buying second hand cars. I disagree with this as I imagine most “early adopters” of EVs will sell their car only to buy a brand new EV. Overall uptake of EVs should still increase and will represent good use of funds
Priit
Active Member
Thats how I did my current novated lease on Model 3, however my employer has since amended their contracts and when I asked if I could do this again, they said that their current contracts are exclusive, meaning they only do this with a single salary packaging company for any salary packaging needs and no other arrangements can be done outside that company and the contract they have signed with this company restricts any car purchase to the government set Car Depreciation Limit, so that does not really leave much options for EV-s. For me ordering a new Model 3 and selling my current one and moving on to the new would be really beneficial as I would be saving the FBT on the new one that I would have to be continuing to pay on the old one, but since that limit does not allow me to get a new one, so I will keep my current one unless anything changes that improves this situation for me.
Its a job seekers market. Sort it out or you start looking for company that isn't so restrictive.
Jusebert
Member
I'm glad a lot of submissions have asked about grandfathering the exemption which is a question I had for my leasing company. I don't want to sign up for a 5 year lease if there is a chance I lose the benefit in year 4 and 5.
It would be nice if we were also able to claim for charging our EV at home without having to have the EV charger on a different circuit. if my Tesla can track how much electricity it has consumed from home I think that should be enough for the ATO?
It would be nice if we were also able to claim for charging our EV at home without having to have the EV charger on a different circuit. if my Tesla can track how much electricity it has consumed from home I think that should be enough for the ATO?
The leasing company I ended up with, LeaseLab, said this wouldn't be an issue.
They gave me these options, but I assume as long as I can them some sort of proof, it should be alright
I am planning on using one of those apps to generate a monthly report. I asked about that here: Automated way to log charging amounts/costs?
Jusebert
Member
So internal dilemma - getting my car through a novated lease and financially its stupid but If I intend to keep my model 3 for 10 years at a minimum I'm considering getting Enhanced Autopilot added to my order as it'll still be under the luxury car tax threshold and benefit from the FBT exemption. Now it's probably not much of a benefit after you add 5k to the finance of the vehicle and then deduct the marginal tax rate but....YOLO???
Jusebert
Member
They've adjusted the reporting date (seems the date in the committees page was entered incorrectly)
Status: Submissions Closed
Date Referred: 28 July 2022
Reporting Date: 21 September 2022
The next sitting days with both houses after this is only three days from the 25th until 27th October. I think this bill's earliest chance of being assented to will be the sitting days in November from 21st until 30th.
Has anyone's lease companies already advised that once this passes they will back date the FBT exemption? Curious as to how this works, do you get a refund or does it become part of your tax return?
Status: Submissions Closed
Date Referred: 28 July 2022
Reporting Date: 21 September 2022
The next sitting days with both houses after this is only three days from the 25th until 27th October. I think this bill's earliest chance of being assented to will be the sitting days in November from 21st until 30th.
Has anyone's lease companies already advised that once this passes they will back date the FBT exemption? Curious as to how this works, do you get a refund or does it become part of your tax return?
hyperdallas
Member
Following on from here (Labor Electric Car FBT discount)
A bill has been introduced into parliament to amend the Fringe Benefits Tax Assessment Act of 1986, to exempt benefits relating to cars that are zero or low emissions vehicles.
(https://parlinfo.aph.gov.au/parlInf.../toc_pdf/2251b01.pdf;fileType=application/pdf)
The conditions are:
A car benefit is an exempt benefit in relation to a year of tax if:
(a) You have the vehicle with the same employer;
(b) The car is a zero or low emissions vehicle; and
(c) no amount of luxury car tax has become payable on supply or importation before the benefit is provided.
LCT is exempt IF the car’s value at the first retail sale is below $84,916 for 2022-23. Now if only Tesla dropped the retail price of their Long Range Model 3 by $1,000 OR NSW Gov gave a bigger incentive.....
A bill has been introduced into parliament to amend the Fringe Benefits Tax Assessment Act of 1986, to exempt benefits relating to cars that are zero or low emissions vehicles.
(https://parlinfo.aph.gov.au/parlInf.../toc_pdf/2251b01.pdf;fileType=application/pdf)
The conditions are:
A car benefit is an exempt benefit in relation to a year of tax if:
(a) You have the vehicle with the same employer;
(b) The car is a zero or low emissions vehicle; and
(c) no amount of luxury car tax has become payable on supply or importation before the benefit is provided.
LCT is exempt IF the car’s value at the first retail sale is below $84,916 for 2022-23. Now if only Tesla dropped the retail price of their Long Range Model 3 by $1,000 OR NSW Gov gave a bigger incentive.....
hyperdallas
Member
or tesla offered a fleet discount of $1,000 or more to get the on road price under the LCT threshold....
Please use the existing thread...
Also the LCT threshold is the price of the vehicle before on road costs, the M3LR in white with 18" wheels and black interior is $81,725.
Also the LCT threshold is the price of the vehicle before on road costs, the M3LR in white with 18" wheels and black interior is $81,725.
This makes the most sense in my books, if it doesn't pass they then need to redo the novated lease and recoup some ECM payments to balance out the FBT liability.
Jusebert
Member
Hmm don't get caught out with this. The bill as it's written right now says "Additionally, to be eligible for the exemption the value of the car at the first retail sale must be below the luxury car tax threshold for fuel efficient cars."
Not paying Luxury Car Tax is not exclusive to being able to access the FBT exemption as it reads the value of the car at first retail sale. I could be wrong but I don't want people getting caught out here.
hyperdallas
Member
I asked my lease company today about it and I tend to agree. It's a massive gamble, since if the legislation doesn't pass or is held up post 1 Apr 23, your liable for the entire FBT component. I can't see it happening, but its a big risk none the less.
I got some advice on this today too... If you purchased the car prior to the legislation and any LCT at all is payable, you wont be able to drop the FBT component ever on that vehicle, because LCT was paid at the vehicle's very first point of retail sale. Could be a trick for young players by the sounds... but I guess it will all come out in the wash once the legislation is approved and becomes law.
I did contemplate placing an order now anyhow, and hoping the date of sale occurs after the legislation drops to be sure... but with prices just gone up on the whole range, I might just hold out a bit and see if prices drop a bit once the inflation gets under control... or impatiently order anyway when the law drops
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