Since 1 July 2022, electric vehicles have been exempt from fringe benefit tax (FBT). A fringe benefit is a payment to an employee not in the form of salary or wages, for example provision of a car that includes for personal use.

The fringe benefit tax is paid on the value of this benefit. For a $55,000 car the FBT bill could be almost $11,000 (based on the statutory calculation method). Employers can calculate FBT using the ATO’s FBT for Cars Calculator.

Under the exemption, you do not pay FBT on private use of a car, if it is;

  • a zero or low emissions vehicle,
  • used by an employee or their family members,
  • first held and used from 1 July 2022,
  • not subject to luxury car tax.

Zero or low emissions vehicles include plug-in hybrid electric vehicles (until 1 April 2025), hydrogen fuel cell electric vehicles and battery electric vehicles, designed to carry less than 9 passengers and carry a load of less than 1 tonne. Motorcycles and scooters do not qualify for the exemption.

If you have any queries about fringe benefits, please contact us on (02) 9908 9888.