Toyota's First PHEV Finally Arrives — Is the RAV4 PHEV Worth Leasing?
Toyota has launched its first plug-in hybrid, the 2026 RAV4 PHEV. Here's what Australian salary earners should know about leasing one. Read the millarX breakdown.
Toyota spent decades being the hybrid company. So it's a little ironic that it took until 2026 for them to release their first plug-in hybrid vehicle (PHEV) in Australia — the RAV4 PHEV. As EVcentral reports, Toyota is now going head-to-head with the likes of GWM, Haval, and BYD in the plug-in segment. That's a crowded space, and Toyota is late to it.
Better late than never — because the RAV4 name carries real weight with Australian buyers. If you're a PAYG employee thinking about your next car, the timing matters: there's a novated leasing angle here worth understanding before you walk into a dealership.
What this means for novated lease customers
Here's the key question: does the 2026 RAV4 PHEV qualify for the EV FBT exemption?
Short answer: no — not as things stand. The current FBT exemption under the Treasury Laws Amendment (Electric Car Discount) Act covers battery electric vehicles (BEVs) and hydrogen fuel cell vehicles. PHEVs were included temporarily but, under legislation passed in 2024, plug-in hybrids lost their FBT-exempt status for leases entered into from 1 April 2025 onwards. The RAV4 PHEV — arriving after that cutoff — does not benefit from the exemption for new leases.
That said, a novated lease on the RAV4 PHEV can still deliver meaningful pre-tax savings compared to buying outright. Running costs — fuel, registration, insurance, servicing — can still be bundled into your pre-tax salary under a standard novated arrangement, reducing your taxable income. The FBT on a PHEV is calculated differently than on a standard car, so the numbers depend on your employer, salary, and how much you drive on electric power. Get a proper comparison before assuming it's not worth it.
Common questions
Is the 2026 Toyota RAV4 PHEV FBT-exempt like a full EV?
No. PHEVs lost their FBT exemption for leases entered into from 1 April 2025. The RAV4 PHEV is a plug-in hybrid, not a battery-electric vehicle, so standard FBT rules apply to new leases.
Can I still save money by novated leasing a RAV4 PHEV?
Yes — potentially. Pre-tax packaging of the vehicle and its running costs still reduces your taxable income. The savings are real, just smaller than what you'd get on a fully exempt BEV. A millarX consultant can run the actual comparison for your salary and situation.
How does the RAV4 PHEV compare to a BYD or GWM on a novated lease?
BEV models from BYD (like the Atto 3 or Seal) currently attract zero FBT under the exemption, which is a structural cost advantage. The RAV4 PHEV competes on brand familiarity, dealer network, and residual value — but not on FBT treatment. Whether that trade-off works for you depends on your priorities.
What happens to my existing PHEV novated lease if I took it out before April 2025?
Leases entered into before 1 April 2025 that included a PHEV under the original exemption were grandfathered. If you started a new PHEV lease after that date, the exemption does not apply. Check your lease start date and speak to your employer's salary packaging team if you're unsure.
Is the RAV4 PHEV available now through novated leasing?
As a newly launched model, availability will depend on dealer stock and your state. millarX can source vehicles through our procurement process — contact us to check lead times and current pricing.