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%.

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:

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:

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:

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