How is FBT Calculated?

FBT is Fringe Benefit Tax. This is how FBT is calculated.

FBT stands for Fringe Benefits Tax. If an employer provides you with any sort of remuneration or benefit other than cash salary, they may be providing you with a Fringe Benefit. As such, your employer may incur a Fringe Benefit’s Tax liability. In some cases (such as private vehicle usage) your employer may elect to charge this to your package as a cost of employment.

How is FBT calculated?

Fringe Benefits Tax is calculated at 48.5% of the grossed-up value of the benefit provided.

In the case of a motor vehicle, the Fringe Benefit Value is a function of the base value of the vehicle multiplied by the percentage of private use. In most cases the Statutory Percentage for private use is used.

This assumes that for a given total kilometres, the percentage private use is as follows:

<15,000kms 20%
15,000 – 24,999kms 20%
25,000 – 39,999kms 20%
>40,000kms 20%


If you have any questions regarding FBT please contact us for more information.