MG4 Novated Lease Pricing and Savings: Is it Worth it in 2024?

Yes, MG4 is FBT exempt so long as they meet the following requirements of the Electric Car Discount Bill:

• First used or purchased after 1 July 2022; and
• The price (plus the $1400 delivery fee) falls below the luxury car tax threshold of $89,332 for 2023/24.

At the time of writing, these MG 4 models available for sale are eligible for the EV FBT exemption.

Yes, a MG4 can be procured on a novated lease like any other car. A novated lease is accessed through your employer through a salary packaging arrangement with a novated lease provider.

Zecar can help you match you with the best novated lease provider for your company, make an enquiry here.

Yes, buying (or rather procuring) a MG4 through a novated lease will result in tax savings which will reduce the overall cost of owning the car. To illustrate the benefit of an FBT exempt electric car we’ll compare it to an outright purchase in the following example.

Jane works as a Sales Representative for a New South Wales (NSW) based company.

• Drives 15,000 km per annum
• Earns $100,000 gross income per annum
• Procure a MG4 Standard Range Excite ($44,990 MSRP) through a novated lease and a salary packaging arrangement through her employer.

MG4 Novated Lease vs Outright purchase

Over a three-year lease, the total costs of the novated lease are $67,827 - this does not include any tax savings. This is over $8,000 more expensive compared to an outright purchase.

The total cost of the novated lease after tax savings is $52,149. This makes the novated lease $7,090 cheaper than an outright purchase after-tax savings. The tax savings arise from being able to reduce your pre-tax salary by the lease payments and running costs - resulting in Jane being taxed a lower amount. We explain this in more detail here.

This analysis does not take into account additional interest paid on a home loan or foregone interest on a term deposit for the outright purchase option.

If Jane decides to sell the MG4 at the end of the lease, she'll pocket the difference between the sale price and the residual value ($22,384). This will further increase the case for the novated lease.

The table below the key numbers in the example discussed.

If we factor in the likely additional interest paid on a home loan from using cash to pay for the vehicle or the foregone interest earned on a term deposit, the savings from a novated lease are even higher, $15,640 after three years. Refer to the below table for the difference in potential savings across various scenarios.

If you want to better understand the various ways you can save money we recommend reading this step-by-step breakdown.

If you would like a quote for a novated lease, click the button below to provide your details and we'll get back to you shortly.

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MG4 64 kWh vs Toyota Corolla Novated Lease

Another common question we often see is how a MG4 stacks up financially compared to popular petrol equivalents such as the Toyota Corolla. In this example we'll compare a MG4 64 kWh under a novated lease against an Toyota Corolla ZR Hybrid procured under a novated lease and an outright purchase.

Despite retailing more than $5,000 more than the Corolla, procuring the MG4 on a novated lease works out to be $6,660 cheaper than a Toyota Corolla on a novated lease.

A MG4 can be leased in multiple ways: finance lease, operating lease, subscription, and novated lease. Due to the FBT exemption, there is a strong likelihood that a novated lease will provide the highest overall savings.

The cost of a MG4 on a novated lease will depend on a number of factors including; the price of the car, interest rate, term of the loan, running costs, and your level of income.

Based on our analysis, if you earn a median Australian full-time salary ($97,510) or above and drive an average distance (13,000 km) or more, there is a strong likelihood a MG4 (lower than the LCT of $89,332), will be cheaper to procure on a novated lease compared to an outright purchase.