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  • Calculating your FBT

    Employers must self-assess the amount of fringe benefits tax (FBT) they have to pay when lodging their FBT return at the end of each FBT year (1 April to 31 March).

    When working out your FBT liability you gross-up the taxable value of benefits you provide, to reflect the gross salary employees would have to earn at the highest marginal tax rate (including Medicare levy) to buy the benefits after paying tax.

    There are two different gross-up rates to calculate fringe benefits taxable amounts:

    The tax payable is the fringe benefits taxable amount multiplied by the FBT rate.

    To calculate how much FBT you have to pay:

    Step 1

    Work out the taxable value of each fringe benefit you provide to each employee. The rules for calculating the taxable value of a fringe benefit vary according to the type of benefit.

    Step 2

    Work out the total taxable value of all the fringe benefits you provide for which you can claim a GST credit (including excluded fringe benefits).

    Step 3

    Work out the grossed-up taxable value of these benefits by multiplying the total taxable value of all the fringe benefits you can claim a GST credit for (from step 2) by the type 1 gross up rate.

    Step 4

    Work out the total taxable value of all those benefits for which you can't claim a GST credit (for example, supplies you made that were either GST-free or input taxed).

    Step 5

    Work out the grossed-up taxable value by multiplying the total taxable value of all the fringe benefits you can't claim a GST credit for (from step 4) by the type 2 gross up rate.

    Step 6

    Add the grossed-up amounts from steps 3 and 5. This is your total fringe benefits taxable amount.

    Step 7

    Multiply the total fringe benefits taxable amount (from step 6) by the FBT rate. This is the total FBT amount you have to pay.

    See also:

    Next steps:

    Last modified: 29 Mar 2019QC 43873