When you’re claiming FBT exemption for a car, a ute, in this case, it’s under the pretence that you’re only using it sparingly for personal usage. According to Deputy Commissioner for employer obligations and superannuation, Emma Rosenzweig, the ATO is now on a mission to bust some of the myths around FBT, providing a warning to any employers who may be pushing the limits of this personal use rule.
According to Rosenzweig, it’s become fairly common for employers to offer fringe benefits in an attempt to attract more staff in an already tight labour market. She mentions on a podcast how inexperienced employers are attempting to utilise fringe benefits to attract or retain employees, while previously never thinking about fringe benefits tax before.
At the moment, the ATO’s current focus is on increasing awareness about FBT, but Rosenzweig also mentioned how the ATO have received calls about “outrageous claims” that have been made in advertising surrounding FBT.
As such, they’re ready to bust some myths around FBT, particularly around dual-cab utes, as she highlights how most people believe it doesn’t attract FBT if you provide utes to your employees and they bring it home over the weekend once work is finished.
Rosenzweig states, “I’m here to tell you that there is no magic in a ute and the exemption for private use of a work vehicle for FBT is only where that private use is really limited.” As such, anything like camping trips is something that’s not limited to personal use, and is therefore going to attract FBT.
With Christmas only a couple of months away, it’s imperative that you’ve got an idea of the ATO’s position when it comes to car benefits and FBT – especially regarding how FBT might apply to work celebrations at the end of the year.
Rosenzweig also asked employers and accountants to remind themselves of the five draft legislative instruments that were released back in 2023 that outlined all of the implemented changes to FBT record keeping.
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