Novated Lease Tax Calculator
Compare take-home pay before and after your entered vehicle package.
Salary and period
Before lease deductions. Exclude employer super and any extra employer funding.
Your entered package
Quote total for lease, running costs and fees paid from gross salary.
Employee contribution deducted after income tax. Count each payment once.
Annual amount paid in addition to salary. Exclude amounts recovered from salary.
Records your quote’s category. It does not establish an FBT exemption.
Tax assumptions
Single adult includes the ordinary low-income reduction. Family rules excluded.
$14,160
Per year, compared with the same salary without lease deductions.
$3,840
$77,480
$63,320
$12,000
$6,000
$19,000
Full-year adult resident. LITO included. HELP, Medicare surcharge, family rules and other income excluded. Vehicle category does not change the entered deductions.
Annual pay comparison
| Amount | Without lease | With lease |
|---|---|---|
| Taxable salary | $100,000 | $88,000 |
| Income tax | $20,520 | $16,920 |
| Medicare levy | $2,000 | $1,760 |
| Net cash pay | $77,480 | $63,320 |
Pre-Tax and Post-Tax Lease Deductions
This novated lease tax calculator compares the cash effect of the vehicle deductions in your client’s package. Enter annual totals from the quote, including the lease payments, running costs and any fees funded through salary.
The pre-tax deduction reduces cash salary and taxable salary. The post-tax employee contribution reduces cash after tax, with no further income-tax deduction. Record extra employer funding separately only when the employer pays it on top of the stated salary.
The government’s salary-packaging explanation describes the exchange of future salary for benefits. An effective arrangement must exist before the employee earns that salary.
Compare Equivalent Pay Periods
The calculator first works out each full-year tax position, then divides both scenarios into the same display period. Monthly uses 12 periods, fortnightly 26 and weekly 52. Every displayed figure uses that selected period.
The annual estimate includes resident income tax, the low income tax offset and the selected Medicare treatment. The pay table separates income tax from the levy. Period results are annual averages, so actual PAYG withholding and payroll rounding can differ.
The supported financial years are 2025-26 and 2026-27. The latter uses the legislated 15% first taxable bracket. The single-adult levy uses the thresholds in the Medicare Levy Act, with its low-income reduction. A fully exempt selection removes the levy from both scenarios.
Vehicle Benefit Assumptions
The vehicle category records whether the supplied quote concerns an electric car or another car. Changing it leaves the entered pre-tax and post-tax split intact. This comparison does not determine an FBT exemption or recommend an employee contribution.
Eligible electric-car benefits can be exempt while still creating a reportable fringe benefits amount. The ATO’s exempt-car guidance explains that distinction. Review eligibility and reporting separately for the actual vehicle and arrangement.
A Lease Package Worked Through
In this fictional 2026-27 example, annual cash salary is $100,000. The quote has $12,000 pre-tax deductions and $6,000 post-tax deductions. Extra employer funding of $1,000 brings total package funding to $19,000.
With single-adult Medicare treatment, cash without the lease is $77,480. Taxable salary falls to $88,000 with the lease. Income tax changes from $20,520 to $16,920, while the levy changes from $2,000 to $1,760.
The estimated tax and levy saving is $3,840. Cash with the lease is $63,320, a $14,160 reduction. Keep the total employee deductions at $18,000 and move the $6,000 post-tax amount to pre-tax. The saving becomes $5,760 and the cash reduction becomes $12,240.
That alternative split is arithmetic, not evidence that the package satisfies FBT rules. If all $18,000 is post-tax, the displayed saving is $0 and cash falls by $18,000.
Salary Sacrifice for a Car
The salary sacrifice calculation uses your entered deductions. Employer FBT, GST adjustments, finance pricing and residual payments need separate calculations. Include any employer FBT recovery in the supplied deduction totals once, if the quote recovers it from salary.
Extra employer funding is counted in total package funding without reducing employee salary again. If the stated remuneration includes super, enter its cash-salary component here. The comparison does not calculate a change in super entitlement or the eventual cost of owning the car.
Take-Home Pay After Lease Deductions
Cash pay reduction equals pre-tax deductions plus post-tax deductions, less the estimated income-tax and Medicare saving. The ordinary-pay baseline has the same starting salary, financial year and Medicare selection, with both lease deductions removed.
The estimate assumes an adult full-year Australian resident with no other income or deductions. HELP repayments, Medicare levy surcharge, family levy reductions and other offsets are excluded. Reportable benefits can affect HELP and income-tested benefits even when the car is exempt from FBT.
For a client with those adjustments, reconcile the package with their full tax and repayment position before using the cash difference in advice.