FBT Rule Change for Cars

FBT Rule Change for Cars

19 July 2013

The federal government has announced changes to fringe benefits tax (FBT) rules for cars.

Under the changes, the ‘statutory formula’ method will no longer be available for FBT liability calculations on salary sacrificed and employer supplied cars.

Instead the car fringe benefit will be determined using the ‘operating cost’ method which is more rigorous and will require a logbook to be kept to determine the percentage of business use.

The changes apply to new contracts entered into from Tuesday 16 July 2013 and will take effect on April 1, 2014. Existing contracts varied after July 16, 2013, also fall under the new arrangements. 

Existing contracts that are not varied will continue to have access to the existing statutory rate. 

If you would like more information, please contact your local Boyce Accountant. 

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