Calculating your FBT

What you need to do

As an employer, you must self-assess the amount of fringe benefits tax (FBT) you have to pay.

To work out how much FBT you have to pay, you 'gross-up' the taxable value of the benefits you've provided. This reflects the gross salary your employees would have to earn, at the highest marginal tax rate (including Medicare levy), to buy the benefits themselves.

The FBT you owe is the grossed-up amount multiplied by the FBT rate.

You pay this amount to us by the date your FBT return is due, which is generally 21 May.

How to calculate FBT – business and government

Use the steps below if you are a:

• business
• government organisation
• not-for-profit organisation that is not exempt from FBT and not eligible for the FBT rebate.

Step 1: Work out the taxable value of each fringe benefit

• How you work out the taxable value of a fringe benefit varies according to the type of benefit.
• If the cost of the fringe benefit included GST, include this in the taxable value.
• If you provided car fringe benefits, you can use the FBT car calculator to work out the taxable value of those benefits.

Step 2: Add up fringe benefits from step 1 that included GST

• These are fringe benefits for which you can claim a GST credit.
• Include both reportable and any non-reportable benefits.

Step 3: Multiply the step 2 amount by the higher gross-up rate

• The higher (type 1) gross-up rate is 2.0802.
• You can claim GST credits for these fringe benefits. The higher rate takes this into account.
• This rate applies for all FBT years since the FBT year ending 31 March 2019. For gross-up rates in earlier years, see Fringe benefits tax – historical rates and thresholds.

Step 4: Add up the fringe benefits from step 1 that did not include GST

• These are benefits that were either GST-free or input taxed.
• Include both reportable and any non-reportable benefits.

Step 5: Multiply the step 4 amount by the lower gross-up rate

• The lower (type 2) gross-up rate is 1.8868.
• This rate applies for all FBT years since the FBT year ending 31 March 2019. For gross-up rates in earlier years, see Fringe benefits tax – historical rates and thresholds.

Step 6: Add up the amounts from steps 3 and 5

• This is your total fringe benefits taxable amount.

Step 7: Multiply the step 6 amount by the FBT rate

• The FBT rate is 47%.
• This rate applies for all FBT years since the FBT year ending 31 March 2019. For rates in earlier years, see Fringe benefits tax – historical rates and thresholds.
• The amount you have worked out is the total FBT amount you have to pay when you lodge your FBT return.

How to calculate FBT – for FBT-exempt and rebatable not-for-profit organisations

There are additional steps in the FBT calculation if you are a not-for-profit organisation that is exempt from FBT or eligible for the FBT rebate.

This is because the benefits you provide to your employees are exempt or rebatable, up to a capping threshold for each employee.

Use the calculator to work out the FBT payable for the fringe benefits you provide to each of your employees.

FBT-exempt employers – calculate FBT manually

For FBT-exempt employers, fringe benefits you provide to an employee are exempt from FBT, up to a capping threshold. Any fringe benefits in excess of the capping threshold do not qualify for this exemption.

To manually calculate your FBT exempt and non-exempt amounts, see FBT guide: 6.10 Calculating the FBT exemption.

Rebatable employers – calculate FBT manually

For rebatable employers, you apply a rebate to the grossed-up value of fringe benefits you provide to an employee, up to a capping threshold. Any fringe benefits in excess of the capping threshold do not qualify for the rebate.

To manually calculate your FBT amounts and rebate, see FBT guide: 6.11 Calculating the FBT rebate.

Work out the FBT to pay, including applying the type 1 or type 2 gross-up rate and the FBT rate.