car fringe benefits tax

In Australia, a car provided for private use cops Fringe Benefits Tax—the ATO riding shotgun and checking the glovebox for receipts.

Employers calculate it using either the statutory formula—20% of the car’s base value, pro‑rated for the days it’s available—or the operating cost method, which applies your private‑use % (from a logbook) to total running costs.

The result is then grossed‑up and taxed at about 47% FBT, with the FBT year running 1 April to 31 March.

You can soften the blow with employee contributions (after‑tax payments), disciplined logbooks, less private use, or eligible EVs that can be FBT‑exempt under current rules.

Not sorcery—just bureaucracy with a lead foot; get an accountant to sanity‑check your sums.