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If your business provides cars, meals, entertainment, loans or housing to employees or their families, you have FBT obligations — even if you don't realise it. We identify every reportable benefit, calculate the grossed-up taxable value, lodge the annual return, and keep you clear of the 47% top rate.
Book a 60-minute consultation — AUD $250, credited to your services if you engage. We'll identify your reportable benefits, review exemptions and concessions, and deliver a formal written proposal.
A 60-minute video call to review your employee benefits, identify your FBT exposure and available exemptions — and deliver a formal written proposal for our services.
Via video call · 60 minutes
Book Now — AUD $250
Fringe Benefits Tax (FBT) is a tax the employer pays on non-cash benefits provided to employees, their families, or other associates. It's separate from income tax, lodged on a separate return, and runs on a different year — the FBT year runs from 1 April to 31 March, not 1 July to 30 June. Most small business owners don't realise they have FBT exposure until the ATO comes knocking — but if you've provided a company car, taken staff out for dinner, or loaned money to a director, you're already in FBT territory. The top rate is 47%, so getting this right matters.
FBT is high on the ATO's audit radar for small and medium business. Lodging a clean return every year keeps you off the review list and protects you from backdated assessments.
FBT has a long list of exemptions and concessions — minor benefits, otherwise deductible, work-related portable devices, small business car parking. We find them all so you only pay tax on benefits that genuinely attract it.
Once we understand your benefit pattern, we can restructure employee packages to legally reduce FBT exposure going forward — often saving thousands per employee per year.
The ATO defines more than a dozen categories of fringe benefits. These are the four we see most often missed or miscalculated by Brisbane small businesses — any one of them can trigger a surprise FBT bill.
Providing a company car that employees can use for private purposes is the most common FBT trigger. Both the statutory formula method and operating cost method are available — we choose the one that minimises your FBT liability and keep the logbook and kilometre records to defend it.
Staff lunches, client dinners, end-of-year parties, team drinks — most of these create an FBT liability unless they fall under the minor benefits exemption (under $300 per employee, infrequent). The 50/50 method and actual method each have trade-offs we'll walk through.
Loans to employees, directors or their families at below the ATO benchmark interest rate create a taxable fringe benefit. This is especially relevant for Pty Ltd companies with Division 7A exposure — we coordinate your FBT and Div 7A positions through our business tax return service.
Paying personal expenses on behalf of employees (phone bills, gym memberships, school fees) creates an expense payment fringe benefit. Providing accommodation or rent assistance triggers housing benefits. Both are commonly missed.
Our FBT return service is fully managed. We review every reportable employee benefit, apply the correct valuation method, claim available exemptions, prepare the return, and lodge with the ATO by 21 May. Pair it with our business tax return and financial statements services for a coordinated year-end compliance package.
Every FBT return we prepare includes:
FBT runs on its own year, has its own return, and has some of the tightest lodgement windows of any ATO obligation. Here's what you need to know for the current year.
Unlike income tax (1 July to 30 June), the FBT year ends 31 March. The 2025–26 FBT year runs from 1 April 2025 to 31 March 2026.
1 Apr – 31 MarSelf-lodgers must submit the annual FBT return by 21 May following the end of the FBT year. Tax agent clients typically get an extension to 25 June, depending on their lodgement program category.
21 May (self) / 25 Jun (agent)FBT is levied at the top marginal tax rate plus Medicare Levy — currently 47% for the 2025–26 FBT year. Because benefits are grossed up before tax is applied, the effective cost of providing a taxable benefit can be close to twice its face value.
47% flat rateBenefits under $300 per employee that are provided infrequently and irregularly may be exempt under the minor benefits rule. Getting this right can save thousands per year on staff functions and small gifts.
Under $300 per benefitThere's no separate FBT registration in the way there is for GST — any employer providing fringe benefits is automatically within the FBT system. However, you only need to lodge an FBT return for years in which you had a taxable fringe benefit liability. If your only benefits fall under exemptions, no return is required — but we recommend keeping working papers to prove it.
Any non-cash benefit you provide to an employee (or their family/associates) in respect of their employment — including a company car for private use, paying their personal bills, low-interest loans, free accommodation, meals, entertainment, gym memberships, club fees, school fees, and goods. Cash wages, super, and allowances are NOT fringe benefits — they're taxed under the normal PAYG system.
Almost certainly yes. Providing any private use of a company vehicle generally creates a car fringe benefit, even if the employee reimburses fuel. We'll calculate the liability under both the statutory formula and operating cost methods and use the lower result. For most small businesses with one or two cars, the FBT is manageable when structured properly.
Benefits under $300 (GST-inclusive) per employee that are provided infrequently and irregularly may be exempt from FBT. This covers things like occasional staff lunches, small gifts, or the end-of-year Christmas party — but only if you meet all five tests in the ATO's infrequency, irregularity, and total value criteria. Getting this right can save significant FBT on staff morale spending.
If you had a taxable fringe benefit liability and didn't lodge, you face Failure-to-Lodge penalties plus interest on the unpaid tax. The ATO can also amend prior years going back five years, turning a small missed liability into a significant backdated assessment. If you think you have historical FBT exposure, we can help you voluntarily disclose through the ATO's Voluntary Disclosure program — which usually reduces penalties by 80%.
Yes — legitimate salary sacrifice arrangements can shift the tax burden in ways that benefit both employer and employee. Common examples include novated leases, additional super contributions, and (for certain not-for-profit employers) exempt benefits up to caps. We'll identify packaging opportunities as part of our tax planning service before the start of the next FBT year.
FBT paid is deductible for income tax purposes, so it reduces your taxable income. However, FBT attracts its own GST treatment and affects employee payment summaries through the Reportable Fringe Benefits Amount (RFBA). We prepare FBT returns in coordination with your business tax return and BAS to ensure all three line up correctly.
60 minutes. Tailored to your employee benefits, exemptions and salary packaging opportunities. Formal written service proposal included.
✓ No obligation to proceed · Fee credited to implementation if you engage
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