The Fringe Benefits Tax (FBT) year ended on 31 March 2025, and the lodgement deadline is 21 May 2025 or 25 June if lodged electronically by an appropriate registered tax agent.
If you provided any non-cash benefits to employees such as vehicles, accommodation, or expense reimbursements it’s time to assess your FBT obligations.
We’ve summarised this year’s key developments below to help you stay compliant and avoid unnecessary penalties.
Changes to Electric Vehicle FBT Exemptions
From 1 April 2025, plug-in hybrid electric vehicles (PHEVs) will no longer be eligible for the electric car exemption under FBT law.
However, you can still apply the exemption if:
- The PHEV was in use or available before 1 April 2025; and
- There’s a binding agreement in place to continue private use beyond that date.
Last year, the ATO introduced a simplified method for valuing electricity costs when electric vehicles (EVs) are charged at an employee’s home. Under this guideline, employers can apply a home charging rate of 4.20 cents per kilometre to estimate electricity expenses—useful for both income tax purposes (car expense deductions) and FBT calculations (operating cost method).
Note: This method does not apply to plug-in hybrid electric vehicles (PHEVs), as they use both petrol and electricity. At present, there is no formal ATO method for valuing electricity costs for PHEVs—although future guidance is expected.
Even if an EV qualifies for the FBT exemption, its private use may still need to be reported as a Reportable Fringe Benefits Amount (RFBA)
New Record-Keeping Options
From the 2025 FBT year onward, the ATO allows employers to use corporate records instead of employee declarations or travel diaries for certain benefits.
This provides flexibility, but the same level of detail and documentation is still required by lodgement time.
The ATO continues to monitor:
- Incorrect classification of vehicles
- Inadequate or inaccurate logbooks
- Blanket employee contributions that don’t match reporting
- Employers lodging nil returns without assessing their FBT liability
Tips for lodgement
Before lodging, make sure you’ve:
- Identified all benefits provided
- Calculated taxable values
- Reported any required fringe benefits on employee income statements (if over $2,000)
- Paid any FBT liability
- Maintained records to support your position
If you’re unsure whether your business is affected by these changes get in touch with our team. We’re here to help you get it right.