NEWS & BLOGS

There’s a common myth that dual cab utes are automatically exempt from fringe benefits tax (FBT) for this private use. However, that’s not the case.

If your business provides dual cab utes to your employees to complete their duties and the vehicle is available for personal use, then the benefit may be subject to FBT.

Knowing how your employees use their dual cab utes outside of work will help you determine when FBT applies so you can meet your FBT obligations, or avoid paying the 47% FBT by putting in private use based on what your 12 week car logbook shows.

To establish if you or your employees’ use of the dual cab is exempt, there are two main conditions that must be met. The dual cab must be:

When FBT doesn’t apply

An eligible vehicle which means it is designed to carry:

 – a load of one tonne or more, or

 – more than 8 passengers (including the driver), or

 – a load under one tonne and not designed to carry 8 passengers

Minor irregular use of the vehicle such a an occasional trip to the tip.

When FBT applies:

If your employee’s personal use does not meet both of the above exemptions, your business will be liable for FBT and you need to keep records. If FBT applies, you need to:

Keep accurate records

determine the value of the fringe benefit

calculate the amount to pay lodge an FBT return and pay the FBT owing

If the value is more than $2000 report the employees reportable benefit through Single Touch Payroll.