FBT Calculator (Fringe Benefits Tax)
Calculate Fringe Benefits Tax payable on employee benefits. See the grossed-up value, total FBT liability, employer cost, and whether the benefit is reportable on payment summaries.
Based on 2025-26 FBT year rates (1 April 2025 to 31 March 2026). FBT rate: 47%.
The taxable value of the fringe benefit provided to each employee
Type 1 if your business can claim a GST credit on the benefit; Type 2 otherwise
How many employees receive this benefit
Enter benefit details to calculate FBT
How Fringe Benefits Tax Works
FBT is a tax paid by employers on non-cash benefits provided to employees. Unlike income tax, FBT is paid by the employer, not the employee. The tax is calculated on the "grossed-up" value of the benefit at a flat rate of 47%.
The FBT year runs from 1 April to 31 March, which is different from the income tax year (1 July to 30 June).
The FBT Calculation Formula
FBT is calculated in two steps:
Step 1: Grossed-up value = Taxable value of benefit × Gross-up rate
Step 2: FBT payable = Grossed-up value × 47%
Example (Type 1): $5,000 × 2.0802 = $10,401 × 0.47 = $4,888.47
The gross-up rate effectively converts the benefit's value to the equivalent pre-tax salary an employee would need to earn to purchase that benefit themselves.
Type 1 vs Type 2 Benefits
The type of benefit determines which gross-up rate to use:
| Benefit Type | GST Credit? | Gross-up Rate | Common Examples |
|---|---|---|---|
| Type 1 | Yes | 2.0802 | Cars, entertainment, electronics |
| Type 2 | No | 1.8868 | Residential rent, exempt supplies |
Use Type 1 when your business can claim a GST credit for the GST included in the cost of providing the benefit. Use Type 2 when no GST credit is available (e.g., the supply is GST-free or input-taxed).
Worked Example
An employer provides a $10,000 entertainment package (Type 1 benefit) to 3 employees:
| Step | Calculation | Amount |
|---|---|---|
| Taxable value per employee | Benefit amount | $10,000.00 |
| Grossed-up value | $10,000 × 2.0802 | $20,802.00 |
| FBT per employee | $20,802 × 47% | $9,776.94 |
| Total FBT (3 employees) | $9,776.94 × 3 | $29,330.82 |
| Total employer cost | $30,000 + $29,330.82 | $59,330.82 |
The total cost to the employer is nearly double the value of the benefit itself, which is why many employers use salary sacrifice or exempt benefit strategies to reduce FBT.
Common FBT Exemptions
Several categories of fringe benefits are exempt from FBT or eligible for concessions:
- Minor benefits: Benefits under $300 that are provided infrequently and irregularly
- Work-related items: Portable electronic devices, tools of trade, protective clothing, and briefcases (one per FBT year)
- Exempt vehicles: Cars used primarily for business (operating cost or statutory method)
- Otherwise deductible rule: Benefits the employee could have claimed as a tax deduction
- Meal entertainment: Can use 50/50 split method or 12-week register method
- Electric vehicles: Zero or low-emissions vehicles below the luxury car tax limit are FBT-exempt from 1 July 2022
Salary sacrifice tip: Salary sacrificing into super is not a fringe benefit and is not subject to FBT. It's often more tax-effective than providing fringe benefits, as concessional super contributions are taxed at only 15%.
Reportable Fringe Benefits
If the total grossed-up taxable value of fringe benefits provided to an individual employee is $2,000 or more, the amount must be reported on their payment summary (income statement).
While reportable fringe benefits don't increase the employee's income tax, they can affect:
- Medicare Levy Surcharge liability
- HELP/HECS-HELP repayment obligations
- Family Tax Benefit entitlements
- Child support assessments
- Government co-contribution eligibility
FBT Key Dates
| Date | Event |
|---|---|
| 1 April | FBT year begins |
| 31 March | FBT year ends |
| 21 May | FBT return due (self-lodgers) |
| 25 June | FBT return due (tax agent lodgement) |
FAQ
What is Fringe Benefits Tax (FBT)?
Fringe Benefits Tax (FBT) is a tax paid by employers on non-cash benefits provided to employees, their associates, or former employees. It is separate from income tax and is calculated on the grossed-up taxable value of the benefits at a flat rate of 47%.
What is the current FBT rate?
The FBT rate for the 2025-26 FBT year (1 April 2025 to 31 March 2026) is 47%. This rate equals the top marginal income tax rate (45%) plus the Medicare levy (2%).
What is the difference between Type 1 and Type 2 benefits?
Type 1 benefits are those where the employer is entitled to a GST credit for the benefit. They use a higher gross-up rate of 2.0802. Type 2 benefits are those where no GST credit is available, using a lower gross-up rate of 1.8868. Common Type 1 benefits include car fringe benefits and entertainment. Type 2 benefits include exempt or GST-free items like residential rent.
What is the FBT gross-up rate?
The gross-up rate converts the taxable value of a fringe benefit to a grossed-up amount that reflects the pre-tax salary equivalent. For 2025-26, the Type 1 gross-up rate is 2.0802 and the Type 2 gross-up rate is 1.8868. FBT is then calculated at 47% on this grossed-up amount.
What is the minor benefit exemption?
A fringe benefit with a taxable value of less than $300 may be exempt from FBT under the minor benefit exemption, provided it is provided infrequently and irregularly. Common examples include occasional meal vouchers, small gifts, or minor items. The exemption does not apply to in-house benefits or car parking.
When is the FBT return due?
The FBT year runs from 1 April to 31 March. FBT returns are due by 21 May each year (or 25 June if lodging through a tax agent). Quarterly PAYG instalments for FBT are due on the 28th of the month following each quarter.
Tax Accuracy & Sources
This calculator is an estimate tool and may not cover all personal circumstances. For state-based taxes, confirm details with your state or territory revenue office.
Last reviewed: February 2026. Based on ATO FBT rates for the 2025-26 FBT year.