Fringe benefit tax on specific categories of benefits: Motor vehicles
Daily exemptions for motor vehicles
If a motor vehicle provided to an employee is available for their private use, it may still be exempt from fringe benefit tax on certain days due to:
- emergency calls
- out-of-town travel
- unavailability of the motor vehicle.
You must also keep records to support any daily exemptions you claim. Some vehicles may qualify for a general exemption from fringe benefit tax.
Emergency calls
A motor vehicle is exempt from fringe benefit tax for the whole day of any day on which an employee uses it to attend an emergency call. The visit must be for one of the following purposes:
- to attend some essential plant or service of the employer or a client
- to maintain services of a public or local authority
- to supply energy or fuel to the public
- to attend in relation to a person's health or safety.
In addition, the visit must take place between 6 pm and 6 am Monday to Friday, or any time on Saturdays, Sundays or statutory holidays. These time restrictions do not apply when the visit concerns personal health or safety.
Out-of-town travel
When an employee is required to travel, the motor vehicle is exempt from fringe benefit tax on trips that are longer than 24 hours. This exemption includes the day of departure and the day of return.
Private use that is incidental to travel may qualify for an exemption. However, if private travel is a significant part of the trip, the vehicle is subject to fringe benefit tax for all the days of travel.
Vehicle not available
From time to time a vehicle may be unavailable to employees. You can claim an exemption for the days that it is unavailable if:
- The vehicle is unavailable to the employee or any of their associates for at least one complete 24-hour period .
- You record a valid reason why the vehicle is unavailable. For example, the vehicle has broken down or is under repair, or the employee has left the vehicle at the airport car park while taking a business-related flight.
Date published: 14 Oct 2004
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