Recent law changes
Exemption for the private use of electric vehicles
From 1 July 2022, employers won't pay FBT on benefits provided for eligible electric cars and associated car expenses. Benefits provided for electric cars are exempt from FBT if all the following criteria are met:
- the car is a zero or low emissions vehicle
- the first time the car is both held and used is on or after 1 July 2022
- the car is used by a current employee or their associates (such as family members)
- luxury car tax has never been payable on the importation or sale of the car.
For more information, see Electric cars exemption and the Electric vehicles and fringe benefits tax fact sheet.
Changes to employee declarations
The make and model of the car are no longer required for the following employee declarations:
- Remote area holiday transport (section 60A and 61 of the FBTAA).
- Overseas employment holiday transport (section 61A of the FBTAA).
- Relocation transport (section 61B of the FBTAA).
- Employment interview or selection test (section 61E of the FBTAA).
- Work-related medical examinations, medical screenings, preventative health care or counselling or migrant language training (section 61F of the FBTAA).
These declarations have been updated accordingly and are available on ato.gov.au.
Upcoming law changes
Changes to FBT record keeping
From 1 April 2024 (the FBT year ending 31 March 2025), for certain benefits, employers will have a choice to use existing records in place of statutory evidentiary documents, such as travel diaries or employee declarations. This will only apply if the Commissioner has made a determination by legislative instrument that applies to the employer which specifies the kind of alternative documents or records.
For more information, see Changes to fringe benefits tax record keeping.
Administrative changes
Deferral of due date for balancing payment for FBT
The due date for the balancing payment for FBT for employers using tax practitioners who lodge FBT returns electronically has been deferred from 28 May to 25 June.
The due date of the balancing payment is now aligned to the due date of the FBT return lodgment date of 25 June for this class of taxpayers.
This deferral applies from the 2021 FBT year onwards.
Recent public advice and guidance
Electric vehicle home charging rate – calculating electricity costs when charging a vehicle at an employee’s or individual’s home
Practical Compliance Guideline PCG 2024/2 Electric vehicle home charging rate – calculating electricity costs when charging a vehicle at an employee’s or individual’s home was published on 1 February 2024.
This practical compliance guideline provides guidance on how employers with FBT obligations and individuals with work-related car expenses can calculate electricity costs when charging electric vehicles at an employee's or individual's home.
Employers and individuals can choose to use the methodology outlined in the PCG where they meet the eligibility requirements, or they can determine the cost of the electricity by calculating its actual cost. The choice is per vehicle and applies for the whole income or FBT year.
The EV home charging rate can be used by employers who provide car or residual fringe benefits for calculating a recipient contribution, and the cost of fuel to be included in operating costs. It can also be used where a reimbursement for car expenses is made by the employer to the employee.
Although the private use of an eligible electric car is exempt from FBT, an employer is still required to include the value of the benefit when working out if an employee has a reportable fringe benefits amount. The EV home charging rate can be used when working out the notional taxable value of the benefits associated with the private use of the electric car for reportable fringe benefits purposes.
Plug-in hybrid vehicles which have an internal combustion engine are not covered by this PCG.
Car parking fringe benefits
Car parking fringe benefits (chapter 16) in Fringe benefits tax - a guide for employers has been updated to reflect the principles in Taxation Ruling TR 2021/2 Fringe benefits tax: car parking benefits and to provide further guidance on contemporary car parking arrangements.
Next steps