Maximise your novated lease budget with our clear guide to claimable vehicle expenses. Learn what’s covered, what’s eligible for replacement claims, and what’s off-limits—simple, and straightforward.
A 'replacement', when referring to 'Can Cover Replacements' - means an item/part can be replaced with an identical or equivalent version.
It really does mean 'replacement' though, not upgrade. The key idea is the replacement should restore the car to its original state and value, not enhance or improve it beyond what it originally was.
For example, if you need to replace a damaged wheel, the replacement needs to be the exact same size and model (or very equivalent) as the original, not a larger or more expensive one. Similarly new headlights should match the specs of the ones originally on the car.
Think of it like an insurance claim, if something breaks, the goal is to get you back to the same standard - not upgrade. For example, if your computer needed repair, they would repair it to the same specs it had before, not increase the storage in the process.
Tl;dr: novated leasing budgets can only be used to cover the expenses to maintain the value and usefulness of the car, not enhance it.
The ATO specifies that (generally), any extra that adds value to the car should be paid post-tax, and not incentivised with novated payment benefits.
Novated payments should only be used to maintain the value and usefulness of the car.
For example, if you bought the car with roof racks, or added roof racks to it at some point (at your own cost), and they suddenly got damaged - then replacing them would return the value of the car back to its prior state. Since your just trying to return the value of its car, and the replacement facilitates that, you can use your novated budget to do so.
If however, the car didn't/doesn't have roof racks, and you want to add them - you are technically adding an optional extra that will increase the cars value - and that needs to be done post-tax, and out of pocket.
ATO Fixed Claim Method
You can claim 4.2c per kms driven within the financial year but cannot claim reimbursement for any charging done at a supercharge station. Upload your claim to the Driver Portal on the 30th June for each financial year. Alternatively, if you'd prefer to process a claim each month, you will need to input the kms driven for the period.
Non-fixed Claim Method
Each month you will need to upload your EV at home charging to the Driver Portal, including a screenshot for the car's charging statistics corresponding to the month you are claiming for, and the accompanying electricity bill. To claim charging at a supercharge station, provide the receipt or tax invoice via the Driver Portal for this to be processed.
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