What is fringe benefits tax?
Fringe benefits tax (FBT) is a tax employers pay on non-cash benefits given to employees, like cars or gym memberships.
Fringe benefits tax (FBT) is a tax the employer pays on certain non-cash benefits provided to employees or their associates. Think company cars, gym memberships, entertainment, or discounted loans. The FBT year runs from 1 April to 31 March.
The current FBT rate is 47%, which matches the top marginal tax rate plus the Medicare levy. Employers pay it, but the cost often gets factored into total remuneration packages.
Key facts
- •Paid by the employer, not the employee
- •FBT rate is 47% (2025-26)
- •FBT year runs 1 April to 31 March
- •Some benefits are exempt — like portable electronic devices primarily for work
- •Electric vehicles under the luxury car limit are FBT-exempt until 2025
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FBT CalculatorFrequently asked questions
Does FBT apply to salary sacrifice?
It depends on the benefit. Extra super contributions via salary sacrifice are not subject to FBT. But a novated car lease or other packaged benefits may attract FBT, which the employer passes on to you.
Are electric vehicles exempt from FBT?
Eligible electric vehicles with a value below the luxury car limit are FBT-exempt, making them attractive through novated leasing. Check the ATO for current eligibility requirements.
General information and estimates only — not financial, tax, or legal advice. Always verify with a licensed adviser or the ATO.