April 1 is the start of a brand new year for fringe benefits tax (FBT). To kick things off, I’m sharing my top tips to help get you sorted for the year ahead.
Tip #1
Don’t forget the due date! The 2024 FBT year ended 31 March. Remember to lodge your 2024 FBT return and pay any FBT if you provided certain benefits to your staff in addition to salary and wages. The due date for self-preparers is 21 May, or if your tax professional lodges electronically on your behalf, you have until 25 June.
Tip #2
New year, new changes!
There are two key changes to be aware of for FBT: record keeping and help to calculate your electric vehicle (EV) home charging expenses.
Record keeping
As an employer, you know keeping good records for your FBT reporting purposes is so important. Previously, these records had to be kept in an approved form such as travel diaries, employee declarations and logbooks.
From 1 April, you now have the choice to use existing records instead of travel diaries and declarations, but only for certain fringe benefits. This alternative record keeping option allows you to use your corporate records. For example, you can rely on a detailed work calendar for your record keeping instead of using a travel diary to record an employee’s travel movements.
Check out the ATO website to see if you’re eligible to use this method. This will depend on the type of fringe benefits you provide to your staff.
If you’re not eligible for alternative record keeping, just keep on using the current approved form or record.
Remember, these options apply for the new FBT year and onwards, so make sure you have all the alternative records in time to lodge your FBT return in 2025.
Find more information at ato.gov.au/FBTrecordkeeping
Electric vehicle home charging rate
The second key change is regarding the EV home charging rate, if you provide electric vehicles to staff. Calculating the electricity costs incurred by employees charging these vehicles at home can be tricky, so we’ve issued guidance to help make it simpler to calculate these expenses for FBT and income tax purposes.
The EV home charging rate is 4.20 cents per kilometre and can be used for zero emissions cars only. Plug-in hybrid models are excluded. Employers, you can use this rate back to 1 April 2022 for FBT reporting purposes.
Your employees can also use this rate back to 1 July 2022 for income tax purposes, when using the logbook method. Keep in mind that to rely on this guideline, employees need to have incurred an electricity expense when charging the EV at home.
You can still choose to calculate expenses using actual electricity costs. You need to keep relevant records to support either of these calculation methods.
For more information, visit ato.gov.au/EVexemption
Tip #3
Here’s 4 easy steps to help you get your FBT reporting right the first time.
- Identify the types of fringe benefits you provide.
- Determine the taxable value of each fringe benefit.
- Lodge an FBT return and pay the FBT you owe by 21 May (for self-preparers). If your tax professional lodges electronically on your behalf, you have until 25 June.
- Keep good records that support your calculations and FBT position.
You can lodge your FBT return:
- electronically using Standard Business Reporting (SBR) enabled software
- through your tax agent, or
- by posting a paper FBT return to the ATO.
If you don’t have an FBT liability for the year and you’re registered for FBT, send the ATO a completed FBT non-lodgment advice form.
If this is your first time lodging through a tax professional, make sure you contact them before 21 May to be added to their FBT client list. This ensures you’re eligible for the June lodgment and payment date.
Check out our great range of information at ato.gov.au/howFBTworks
My final tip
We’re here to help.
The ATO understands you may experience difficulties and may not be able to pay on time, which can make it hard to meet your obligations.
Contact us before your due date to discuss your options. If you make a mistake on your FBT return, you can lodge an amended return electronically using SBR enabled software or you can request an amended assessment in writing and send via our online services for business or by post.
For more information visit ato.gov.au/FBT or talk to your trusted tax adviser.
Peta Lonergan
Peta Assistant Commissioner for Superannuation and Employer obligations in the ATO. An experienced tax professional with over 20 years’ experience, Peta started out as a tax accountant before joining the ATO and received her CPA in 2002. Peta has extensive experience across a number of diverse roles in the ATO. Starting out as a frontline business auditor and tax technical specialist, she then progressed onto strategic programs. Peta has a passion for identifying opportunities to challenge the status quo and create innovative team environments.