Compare chattel mortgage, finance lease, and operating lease structures for electric cars, vans, and utes. Understand the FBT exemption, charging vs fuel costs, and 5-year total cost of ownership before you finance your next business EV.
Electric vehicle sales in Australia exceeded 110,000 units in 2024, representing over 8% of all new car sales — up from just 3.8% in 2022. With fuel prices consistently above $1.90/L for petrol and $2.00/L for diesel across major cities, the economic case for switching to an EV has never been stronger.
For sole traders, tradespeople, and fleet operators, an electric vehicle financed through a chattel mortgage can deliver substantial savings in running costs, tax deductions, and — for eligible vehicles — a complete FBT exemption worth thousands annually.
Still comparing models? Browse electric cars, current pricing and indicative repayments at BaseRate, another Velocity Works service focused on vehicle research and car finance. Return here to compare commercial ownership and lease structures.
Planning ranges checked 9 August 2026 • Not quotes, offers or comparison rates and subject to lender approval, credit profile, asset age, and loan amount.
| Structure | Indicative Rate Range (p.a.) |
|---|---|
| Chattel Mortgage (new EV) | 5.79% – 9.49% |
| Finance Lease | 5.79% – 9.99% |
| Operating Lease | By quote |
*Rates depend on your credit score, time in business, asset age, deposit, and loan term. View our full rates guide →
Use our free calculator to compare chattel mortgage, finance lease, and operating lease structures for your EV.
Compare EV Finance →One of the biggest advantages of electric vehicles is the dramatically lower cost per kilometre. Whether you charge at home, at the workplace, or use public fast chargers, the running cost difference is significant — especially for high-mileage business use.
| Cost Factor | Electric Vehicle | Petrol Vehicle | Diesel Vehicle |
|---|---|---|---|
| Energy cost per km | $0.03–$0.05 (home) | $0.12–$0.16 | $0.14–$0.18 |
| Public fast charging per km | $0.07–$0.10 | N/A | N/A |
| Annual fuel/energy cost (20,000 km) | $600–$1,000 | $2,400–$3,200 | $2,800–$3,600 |
| 5-year fuel/energy cost (100,000 km) | $3,000–$5,000 | $12,000–$16,000 | $14,000–$18,000 |
Assumptions: Electricity at $0.30/kWh (home) or $0.50/kWh (public DC); EV consumption 15 kWh/100 km; petrol at $1.95/L using 8 L/100 km; diesel at $2.10/L using 8.5 L/100 km. Your actual costs will vary by vehicle, driving conditions, and energy tariff.
Most business EV owners do 80–90% of their charging at home or the depot overnight using a Level 2 (7 kW) wall charger. A full charge on a 60 kWh battery costs approximately $18 at off-peak rates and provides 350–450 km of range.
Public DC fast chargers (50–350 kW) are available at major highways, shopping centres, and charging networks like Chargefox, Tesla Supercharger, and Evie Networks. Costs range from $0.40–$0.60/kWh — still cheaper per km than petrol, but 2–3x the cost of home charging.
Sole trader tip: If you work from home, your electricity costs for EV charging used for business travel are a deductible business expense. Keep a logbook to distinguish business from personal use.
The purchase price of an EV is typically higher than an equivalent petrol vehicle, but total cost of ownership (TCO) over 5 years tells a very different story — especially for business users who can claim tax deductions and the FBT exemption.
| Cost Item (5 Years / 100,000 km) | Tesla Model 3 RWD | Toyota Camry Hybrid | Difference |
|---|---|---|---|
| Purchase price (drive-away) | $55,900 | $42,000 | +$13,900 |
| Fuel / energy (100,000 km) | $4,000 | $10,500 | −$6,500 |
| Servicing & maintenance | $2,500 | $5,500 | −$3,000 |
| Tyres (1 replacement set) | $1,600 | $1,200 | +$400 |
| Insurance (5 years) | $9,000 | $7,500 | +$1,500 |
| Registration (5 years) | $4,500 | $4,500 | $0 |
| Resale value (estimated) | −$33,500 | −$21,000 | −$12,500 |
| Net 5-Year Cost | $44,000 | $50,200 | −$6,200 |
Note: Figures are indicative based on publicly available pricing as at early 2026. Does not include finance costs or tax benefits, which would further favour the EV for business users. Resale value assumes 60% retention for Model 3, 50% for Camry.
Our calculator compares chattel mortgage, finance lease, and operating lease side-by-side for your electric vehicle.
Calculate EV Repayments →The best finance structure for your electric vehicle depends on your business structure, GST registration, and whether you want to take advantage of the available FBT exemption.
| Feature | Chattel Mortgage | Finance Lease | Operating Lease |
|---|---|---|---|
| Ownership | Immediate | At end of term | Return to lessor |
| FBT Exemption | Depends on employer provision, private availability, vehicle eligibility and the arrangement; the EV exemption is not determined by finance structure alone | ||
| GST Credit | An eligible credit may be available upfront | Eligible credits may arise with payments | Eligible credits may arise with payments |
| Depreciation | The business may claim eligible depreciation | The lessor generally claims tax depreciation | The lessor generally claims tax depreciation |
| Interest / Payments | Eligible business-use interest may be deductible | Eligible business-use payments may be deductible | Eligible business-use payments may be deductible |
| Balloon / Residual | Optional | Mandatory | Built-in |
| Consider When | Business ownership and long-term retention matter | A defined residual and end-of-term option fit the replacement cycle | Return flexibility, fleet rotation or bundled services matter |
A chattel mortgage may suit an ABN holder that wants business ownership of the EV while the lender takes security. An eligible GST credit and business-use interest or depreciation deductions may be available, subject to the car limit and the taxpayer’s circumstances. It is not automatically the best structure.
The lender owns the EV and leases it to you. Monthly payments are potentially deductible, subject to current tax law and the taxpayer’s circumstances as an operating expense. At the end of the term, you pay the residual to take ownership, refinance, or hand the vehicle back. Finance leases work well for businesses wanting to keep the EV off their balance sheet.
A long-term rental with no residual risk. You return the EV at the end of the term. Lowest regular repayments and potentially deductible, subject to current tax law and the taxpayer’s circumstances. Best for businesses that want to upgrade to newer EV models every 3–4 years as battery technology improves.
The EV FBT exemption can materially affect an eligible employer-provided vehicle arrangement. Important status distinction: the 2026–27 Federal Budget announced proposed price caps and a phaseout timeline. Confirm implementing legislation before treating those settings as law.
| Date | EV Price | FBT Treatment |
|---|---|---|
| Now – 31 Mar 2029 | Under $75,000 | Full FBT exemption (0% FBT) |
| 1 Apr 2027 onwards | Over $75,000 | 25% FBT discount (not full exemption) |
| 1 Apr 2029 onwards | All eligible EVs | Permanent 25% FBT discount only |
To lock in the full FBT exemption for eligible EVs under $75,000, the fringe benefit arrangement must commence before 1 April 2029.
The value of an exemption depends on the vehicle, arrangement, taxable value, employee contribution and employer reporting. Do not use a generic annual saving as a quote; obtain a novated-lease comparison showing total deductions, residual, running-cost assumptions and the result if eligibility changes.
Compare the arrangement’s total after-tax cost with purchasing or financing the same vehicle directly. Headline “equivalent vehicle price” claims can conceal residual value, administration fees and optimistic running-cost assumptions.
No — sole traders and partnerships don't pay FBT on vehicles they own and use in the business. The FBT exemption is specifically relevant to employer-provided fringe benefits. However, sole traders still benefit from other EV tax advantages: instant asset write-off, depreciation, interest deductions, and lower running costs.
Whether you're a sole trader or company, financing an electric vehicle unlocks a range of tax deductions.
Note: Tax benefits depend on your individual circumstances, business structure, and how the vehicle is used. Always consult a qualified tax professional before making finance decisions.
Lender requirements for electric vehicle finance are generally the same as for any commercial vehicle. Here are the typical benchmarks:
Our finance team specialises in electric vehicle finance — chattel mortgage, finance lease, or fleet leasing.
Get a Free EV Quote →Sole traders and tradespeople are among the fastest-growing segments of EV adopters in Australia, driven by the combination of lower running costs and strong tax deductions.
A self-employed electrician finances a Tesla Model Y RWD ($62,990 drive-away) via chattel mortgage over 5 years at 6.5% with a 30% balloon ($18,897):
