BMW dealers launch in-house novated leasing for Australians

Smart and BMW Financial Services have announced a partnership that enables Australians to complete novated leasing for BMW and MINI vehicles directly at BMW dealerships.

The partnership allows customers to select a vehicle, arrange finance, and finalise lease agreements on-site at the dealership. Previously, this process required separate coordination between external leasing providers, employers, and finance companies.

This arrangement allows customers to take out a fully maintained lease that bundles major running costs—including servicing, tyres, registration, insurance, and fuel—into one regular payment. A portion of this payment comes from the employee's pre-tax salary, reducing taxable income and delivering financial benefits.

The structure also enables customers to realise GST savings on both the purchase price and the ongoing running costs of their vehicles.

The partnership offers additional advantages for electric vehicle (EV) customers. With the current Fringe Benefits Tax exemption applying to eligible electric vehicles priced below the luxury car tax threshold of AUD $91,387, all of the vehicle cost can be paid using pre-tax earnings, increasing the financial benefits associated with making the switch to electric.

Novated leasing is an arrangement approved by the Australian Taxation Office involving an employee, their employer, and a finance company. In this arrangement, the employer agrees to make lease repayments on behalf of the employee from the employee's pre-tax salary.

Sid Jha, Group Executive, Novated Leasing & Electric Vehicle Services at Smart, said: "Today's customers want simplicity; they want to walk into a dealership and drive away knowing everything, including finance, has been taken care of."

Jha also highlighted the arrangement's financial appeal: "This partnership delivers one of the most affordable ways to own and enjoy a BMW or MINI, while also helping employees take advantage of the tax benefits that come with novated leasing."

May Wong, CEO of BMW Financial Services Australia, commented on the new partnership: "We're proud to launch this first-of-its-kind partnership with SmartTM. By bringing the entire novated leasing process into our dealerships, we're offering a seamless approach and opening the door for more Australians to enjoy the benefits of BMW and MINI ownership—especially those considering electric vehicles as their next car."

The initiative follows recent policy signals relating to clean energy transitions, which have increased focus on affordability and accessibility for electric vehicle adoption in Australia.