For Business · Compliance
Fringe Benefits Tax
FBT runs on its own year ending 31 March, at a rate of 47%, on benefits most employers do not realise they are providing.
Overview
FBT catches employers who are trying to be generous
Fringe benefits tax applies at 47% on the grossed-up value of non-cash benefits, which makes it more expensive than the wage it replaces. A work car available for private use, a Christmas function, a gym membership, paying an employee's phone bill: each can be a fringe benefit, and the year ends on 31 March rather than 30 June.
We identify what you are actually providing, choose the calculation method that produces the lower liability, apply employee contributions and exemptions where they help, and lodge the return. Where the benefit is worth keeping, we design the package around it. Where it is not, we tell you what it is really costing.
How we help
- 01
Motor vehicle calculations
Statutory formula against operating cost, calculated both ways so you lodge on the lower result.
- 02
Entertainment and minor benefits
Functions, meals and gifts assessed against the $300 minor and infrequent exemption.
- 03
Employee contributions
After-tax contributions applied to reduce the taxable value, with the GST consequences accounted for.
- 04
Salary packaging design
Packages structured so the benefit is worth more to the employee than the FBT costs you.
- 05
FBT return preparation and lodgement
Return prepared, reconciled to your payroll and ledger, and lodged under our agent registration.
Resources
Key dates and rates
- 31 March
- FBT year ends
- 25 June
- Return due via a tax agent
- 2.0802
- Type 1 gross-up rate
- 1.8868
- Type 2 gross-up rate
Self-lodgers are due 21 May. Type 1 applies where GST credits are claimable, Type 2 where they are not. Eligible electric vehicles under the $91,387 threshold can be exempt; the plug-in hybrid exemption closed to new arrangements from 1 april 2025.
Not sure whether you have an FBT liability?
We review what you provide before 31 March and tell you what is reportable.
FAQ
Fringe benefits tax questions
Only if you have a liability, but you need to work that out to know. Many employers provide reportable benefits without realising, particularly work vehicles garaged at home. If there is no liability we document why rather than simply not lodging.
Only if private use is genuinely minor and incidental, which is a narrower test than most people assume. Home-to-work travel is allowed within limits; weekend use for a house move is not. Keeping a log removes the argument.
Entertainment for employees can be exempt where the cost per head is under $300 and the benefit is infrequent, but you then lose the deduction and the GST credit. We calculate both treatments and use the cheaper one.
Eligible battery electric vehicles below the $91,387 threshold remain exempt from FBT, though the value is still reportable on payment summaries. The plug-in hybrid exemption closed to new arrangements from 1 April 2025.
A contribution paid by the employee from after-tax income reduces the taxable value of the benefit dollar for dollar. Contributing the FBT-equivalent amount can eliminate the liability entirely, though the contribution itself carries GST.
Speak to an accountant
Free 30-minute consultation.
No obligation. We’ll review where you are and tell you what we’d do.
+61 451 114 862Book a consultationThis page is general information only. It does not take your circumstances into account. Speak to a registered tax agent before acting on anything here.
Related services
Often paired with FBT.
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