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Fringe Benefits Tax (FBT)
Fringe Benefits Tax (FBT) is something every Australian business that offers non-cash perks to employees needs to consider. While these benefits help attract and retain top talent, they also come with specific tax obligations that require proper management to avoid unnecessary costs.
At Carbon Group, our expert tax accountants help businesses navigate FBT compliance, ensuring you meet ATO requirements while reducing tax liabilities wherever possible.
What is Fringe Benefits Tax (FBT)?
FBT is a tax paid by employers on non-salary benefits provided to employees or their associates. These benefits include:
- Company cars for private use
- Entertainment expenses (e.g. meals, event tickets)
- Car parking benefits
- Housing and accommodation allowances
- Low-interest loans
- Private health insurance contributions
If your business provides non-cash perks, you may be liable for FBT reporting and payment. The FBT year runs from 1 April to 31 March, different from the standard financial year.
Identify and assess fringe benefits provided to employees
Accurately calculate FBT liabilities
Explore strategies to minimise your FBT obligations
Ensure compliance with ATO regulations
Prepare and lodge your FBT returns with ease
Fringe Benefits Tax calculator
Unsure if you’re liable for FBT? Use our FBT Checklist Calculator to quickly assess your situation. This simple tool helps you determine whether your business is subject to FBT, ensuring you’re on the right track with your obligations.
Ready to find out where you stand? Enter your details below and get started.
Tailored FBT solutions for your business
No two businesses are the same, and your FBT obligations shouldn’t be treated with a one-size-fits-all approach. We tailor our advice to help you:
- Optimise your employee benefits package
- Set up effective salary packaging
- Make use of exemptions and concessions that work for your business
- Balance employee satisfaction with tax efficiency
Our team stays up to date with the latest ATO rulings, ensuring your FBT strategy remains compliant and always optimised.
Proactive FBT planning and strategy
Managing FBT effectively means looking beyond basic compliance. Our proactive approach includes:
- Annual FBT health checks to keep your approach on track
- Strategic planning for future employee benefits
- Integrating FBT considerations into your overall tax and business strategy
- Ongoing reviews to make sure your FBT plan stays efficient and cost-effective
We’ll work with you to develop an FBT strategy that aligns with your business goals and minimises tax liabilities—because managing tax is about planning, not just ticking boxes.
FBT support forsmall and medium businesses
Small and medium businesses (SMEs) often face unique FBT challenges. At Carbon, we understand what it takes to manage these obligations efficiently, without overextending your budget. We help SMEs:
- Implement cost-effective benefit programs
- Manage FBT liabilities within financial constraints
- Identify and apply exemptions and concessions often overlooked by others
FBT case study
A growing Australian business approached Carbon, struggling to manage their FBT obligations as their team expanded and employee benefits became more complex. Carbon’s FBT specialists quickly stepped in, reviewing their benefits and ensuring compliance with ATO regulations. By accurately calculating FBT liabilities and identifying potential exemptions, we were able to reduce their tax burden and streamline the reporting process. This allowed the business to focus on growth, knowing their FBT was in expert hands.
Ready to optimise your FBT strategy?
Fringe Benefits Tax (FBT) How Carbon can help
Download our FBT Guide eBook for free!
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Frequently Asked Questions
Fringe Benefits Tax (FBT) is a tax paid by employers on certain non-cash benefits provided to employees or associates (e.g. family members). These benefits can include things like company cars, entertainment and other perks offered in addition to salary.
Any Australian business that provides fringe benefits to employees may be liable for FBT. This applies to:
- Companies, partnerships and trusts
- Government agencies
- Not-for-profits (in some cases, exemptions apply)
Common benefits subject to FBT include:
- Car fringe benefits
- Car parking fringe benefits
- Entertainment and recreation
- Low interest loans
- Living away from home allowances
- Private health insurance
Yes, even if you provide small or infrequent benefits, you may still be required to pay FBT. It’s important to assess all benefits provided to your employees, no matter how minor, to determine your FBT obligations.
Yes, several exemptions and concessions are available, including:
- Certain not-for-profits receive FBT concessions or exemptions
- Minor benefits exemption (value under $300, provided infrequently)
- Work-related items (e.g. laptops, mobile phones)
- Certain car parking benefits
FBT is calculated on the taxable value of the fringe benefits provided. The rate for the current FBT year is 47%. Different valuation methods may apply depending on the type of benefit.
It depends on how the vehicle is used. If a company car is used privately, it may be subject to FBT. However, work-related use (e.g. for business trips) is generally exempt. Logbooks or odometer records help determine FBT liabilities.
Salary packaging allows employees to receive benefits instead of salary, often reducing their taxable income. However, employers must ensure that packaged benefits comply with FBT laws.
Yes, but only if the benefits fall under FBT-exempt categories, such as work-related items or contributions to superannuation.
The FBT year runs from 1 April to 31 March. FBT returns are generally due by 21 May each year unless you have a tax agent. Tax agents like Carbon have until 25 June.
Yes. If no fringe benefits were provided, businesses should lodge an FBT non-lodgment advice (NIL return) to confirm their status with the ATO.
If an FBT return (or NIL return) is not lodged, the ATO may:
- Issue a default assessment based on past records
- Contact you for compliance checks
- Apply penalties for failing to lodge on time
You should maintain records of:
- Details of benefits provided (who received them and when)
- Logbooks for vehicles
- Salary packaging agreements
- FBT calculations and exemptions claimed
Records must be kept for at least 5 years.
Strategies may include:
- Providing cash allowances instead of benefits where appropriate
- Utilising available exemptions and concessions
- Implementing effective salary packaging arrangements
- Keeping detailed records to maximise claims
We offer comprehensive FBT services to help your business navigate this complex area of taxation:
- We conduct thorough assessments to identify all fringe benefits provided by your business
- Our experts calculate your FBT liability accurately, ensuring you don’t overpay
- We develop tailored strategies to minimise your FBT obligations while maintaining attractive employee benefits
- Our team stays up-to-date with the latest ATO rulings and legislative changes, ensuring your FBT approach remains compliant and optimised
- We prepare and lodge your FBT returns, taking the stress out of compliance
- We provide ongoing advice and support, helping you make informed decisions about employee benefits and their tax implications
As a business owner, you want to reward your employees while keeping your tax obligations in check. Let us help you create an FBT strategy that optimises your employee benefits and minimises your tax liability. Get in touch with us to learn how we can save you time, stress and money on your FBT.
Contact us today Book a free consultation
To find out more about our FBT services and learn how they can benefit your business, submit your details below and our accountants will be in touch.
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