With the cost of living on the rise, many Australians are discovering Novated leases and subscriptions as a smart alternative to traditional car ownership. If you’re not sure what “Novated” means, don’t worry we’ve got you covered Novated Lease Calculator.



A Novated lease or subscription lets you use part of your salary to cover the cost of a car, instead of buying one outright or taking out a loan. The best part? All your car-related expenses like the lease, maintenance, and running costs are bundled into one simple, monthly payment. Plus, because the payments come out of your pre-tax salary, it can reduce your taxable income, meaning you could pay less tax overall.Through carbar, you can choose from two types of Novated arrangements, each offering different benefits. Let’s dive into both options so you can find the one that suits you best.



What is a Novated Lease?

A Novated Lease is the more long-term option of the two, letting you lease a car of your choice for a set period, usually around two years or more. This is a great choice if you already have a specific car in mind.

With a Novated Lease, your monthly payments are deducted from your pre-tax salary, which can help reduce the amount of tax you pay each year — a nice bonus!

But the benefits don’t stop there. All your car-related expenses, including running and maintenance costs, are bundled into one easy monthly payment, meaning you won’t have to juggle different bills. Plus, the GST (Goods and Services Tax) is covered by the leasing company, saving you even more.

One thing to keep in mind: if you leave your job, you’ll take the car and the lease with you. So, while it offers flexibility, it’s important to be aware of your ongoing commitments.

How to Get Started with a Novated Lease

The first step is simple. You find the car of your dreams whether new or used at a dealership, either in person or online. Just like any great relationship, you connect with the car and decide it’s the one. Then, it’s time to take action. Here’s how it typically unfolds:

And just like that, you’ll be behind the wheel of your new car with all the benefits of a Novated Lease!

What is a Novated Subscription?

A Novated Subscription is perfect for those who love flexibility and variety. If you don’t want to commit to one car or want the freedom to try different models, this is the option for you. It’s a unique offering from carbar.

Similar to a Novated Lease, a Novated Subscription is a salary sacrifice arrangement with your employer. You agree to have your car and running costs deducted from your pre-tax salary, which helps you save on tax while making one easy, all-inclusive payment.

What sets a Novated Subscription apart is the flexibility it offers. There’s no long-term contract, simply give us two weeks’ notice, and you can change or cancel your car at any time. It’s ideal if you want to try an electric vehicle (EV) without the hefty ownership costs, plus you could even enjoy potential Fringe Benefits Tax (FBT) exemptions on the EV.

Payments are made weekly, not monthly, and cover all costs, including maintenance, insurance, registration, and running expenses so there are no hidden fees or surprises.

Your employer also benefits, as Novated Subscriptions simplify accounting. Unlike Novated Leases, businesses aren’t required to include these subscriptions in their financial reports, making it easier for everyone involved.

How to Get Started with a Novated Subscription

If you’re already imagining yourself behind the wheel of an EV or switching up your car every few months, then why wait? Getting started with a Novated Subscription is easy and flexible — here’s how to do it: