Electric Car FBT Exemption EXPLAINED

Fringe Benefits Tax (FBT) is a tax applied to employers when they provide particular benefits such as gifts or providing a car.
The ATO sees this as an alternative means of income, and this tax can get VERY pricy. However, providing benefits can still be a good way to attract and retain top talent.
Additionally, as of July last year, the Australian Government introduced the Electric Car Discount Bill 2022, which means that if you provide your employees with cars for private use, and these cars have zero or low emissions like electric cars, plug-in hybrids or hydrogen fuel cell cars, you won't have to pay FBT on them.
These rules can be very specific and confusing, so watch this video to find out more!
#daviemach #taxdeductions #accounting #fringebenefitstax
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Davie has over 10 years experience in advising businesses in management accounting and taxation issues. He heads up a passionate team at Box Advisory Group who are dedicated to offering proactive and outstanding service to our clients.
Davie’s extensive experience in providing tax and consulting advice and astute business knowledge has paved the way for success for many businesses.
He is a member of the Chartered Accountants Australian and New Zealand, a member of the Australian Tax Practitioners Board and holds a Bachelor of Commerce degree from the University of New South Wales.
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DISCLAIMER: Please note that every effort has been made to ensure that the information provided in this video is accurate. You should note, however, that the information is intended as a guide only, providing an overview of general information available to contractors and small businesses. This guide is not intended to be an exhaustive source of information and should not be seen to constitute legal or tax advice. You should, where necessary, seek your own advice for any legal or tax issues raised in your business affairs.
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[@WiseTvMan2]

This video is so amazing and informational. There is a deep gratitude at the bottom of my seat for you right now.

[@julianhurrell6741]

Thanks Dave. Thats great. I have my own business and I think I am going to do this.

[@DavieMach]

yes, definitely a great tax deduction for the business :)

[@sachitm]

Could you do a scenario for employees as well how they can save using salary packaging purchasing electric car ?

[@adda58]

Music to my ears Davie!!😊

[@anton_adelaide]

Thanks for your video. What if I’m a director and only paying myself dividends (no salary) - how do I report FBT? Also, can I tax-offset the cost of the car fully this fiscal year if it is delivered after EOY?

[@zpatrick9145]

can you do a more detailed explanation of your closing summary (4-50 mark) about claiming while being a director...

[@teodoragarbo7296]

Thank you

[@simplisttechnologies2930]

Thank you - another great video!! If I was to buy the car outright in my companies name (as sole director) but use it almost entirely for personal use, does this exemption mean the business would be able to deduct 100% of depreciation & running / maintenance costs?

[@zpatrick9145]

​ @Davie Mach vid on this 👍

[@raylenevarone]

I'm a small business owner. The car I am purchasing qualifies for FBT exemption re: Hybrid EV. However is there another 'legally binding document" that is available for me to use other than a novated lease. As I don't want to take out a lease. I want to purchase if via commercial finance.

[@cyberdanau]

Thanks for the video, very insightful!
How does it work with the Car Limit? If the EV I purchased was 80k and a passenger vehicle, not a ute etc, can i claim the whole amount of $80k or just up to the car limit of $64,741 for the 2022-23 income tax year?

[@kongtan7687]

Hi David. Great informative video. Just checking what about a Toyota Hybrid? is that included in the "plug-in" hybrid category?

[@zpatrick9145]

No. Has to plug in

[@MilindVJadhav]

Hey mate instead of leasing what if one purchases out right a plug in hybrid car. Will he still be exempt from FBT after April 2025 deadline?

[@Clim326]

Does anyone know if Toyota rav 4 2025 will be a Phev car or not ?

[@Jaimin173]

Hi mate, Tesla Model Y 's towing capacity is 1.6 tonnes. So does it still qualify for fbt exmption? Looks like people are benefiting from that

[@joebyrnes3773]

That's its towing capacity not the same. The vehicle can hold approx 600kgs

[@Dr.christenaChristena]

is the exemption for the life of the EV car or until mid 2027 only?

[@DavieMach]

Not for life but the govt will review this rule in 2027 to see if they will extend or remove it

[@teodoragarbo7296]

So even if is electric car, but a luxury car worth 135k does not qualify for this right?

[@DavieMach]

Correct it is over the luxury car tax limit so it does not qualify

[@deemad2180]

Yeah but the employee then adds the FBT to their individual tax returns

[@DavieMach]

yes, but there is no tax on Fringe benefit as it is exempt.