How you calculate a vehicle’s taxable value for fringe benefit tax (FBT) depends on if you file quarterly, annual or income year returns.
Benefit value for quarterly and annual returns
The taxable value of the fringe benefit is calculated as:
(Private use days × cost price or tax book value ÷ 90) × percentage
The number of days for this calculation cannot be more than 90, regardless of the actual number of days in the quarter.
Private use days is the lesser of:
- the number of days available for private use
- 90 days.
If there are exempt days, deduct these from the number of actual days in the quarter.
| Quarter | Quarterly return period | Actual days in quarter |
|---|---|---|
| 1 | 1 April to 30 June | 91 |
| 2 | 1 July to 30 September | 92 |
| 3 | 1 October to 31 December | 92 |
| 4 | 1 January to 31 March | 90 or 91 in a leap year |
Percentage for cost price or tax book value
| Original cost price % | Tax book value % | Tax book value % with Investment Boost |
|---|---|---|
| 5% including GST | 9% including GST | 10.35% including GST |
| 5.75% excluding GST | 10.35% excluding GST | 11.90% excluding GST |
If you file annual returns, add the amounts calculated for the 4 quarters together.
Benefit value for income year returns
The taxable value of the fringe benefit is calculated as:
(Private use days × cost price or tax book value ÷ 365) × percentage
Private use days
If there are exempt days, deduct these from the number of actual days in the income year.
Percentage for cost price or tax book value
| Original cost price % | Tax book value % | Tax book value % with Investment Boost |
|---|---|---|
| 20% including GST | 36% including GST | 41.40% including GST |
| 23% excluding GST | 41.40% excluding GST | 47.61% excluding GST |
Exempt and unavailable days for pooled vehicles
If there are exempt or unavailable days for any of the vehicles, you must do individual calculations for each to work out the taxable value. This applies to both cost price and tax book values for quarterly, income year and annual returns.
When employees pay or make contributions
Payments or contributions an employee makes in return for a fringe benefit must be deducted when you work out the taxable value of the benefit.
If an employee pays for the fringe benefit in full, you do not need to pay any fringe benefit tax. However, you still need to include the nil fringe benefit value in your FBT records.
Employees paying for fuel
If an employee pays for some or all of the fuel, they must give you a receipt for the amount they paid. The receipt or invoice must meet the normal receipt rules and include the vehicle's registration number. You cannot claim the GST paid or the amount as an expense against income.
Deduct the contributions when you work out the taxable value. If the employee pays for expenses and you reimburse them, the value of the fringe benefit does not change.
Direct payment to the employer
If your employee pays you directly (for example you pay for the petrol and they pay you back), the payment must be recorded as income for both GST and income tax purposes. The employee’s contribution is deducted when working out the taxable value.
Attributing motor vehicle benefits
All motor vehicle benefits must be attributed to the employee receiving the benefit. Vehicle benefits should be pooled when a vehicle is made available to more than 1 employee and you cannot determine the main employee receiving the benefit.
Attributing fringe benefits to individual employees
More information
To read more about employee contributions and attributing motor vehicle benefits, go to Part 2 - Motor vehicles in the Fringe benefit tax guide – IR409.