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FBT - Director and Car

Enthusiast

Views 445

Replies 2

Hi,

Just a few quick questions about FBT on company cars.

1. Assume a person is a director of a company but is not an employee of the company, but the person drives the company's car. Everything in the ATO website keeps referring to an "employee" so, if a director is not an "employee", does that mean the FBT issues do not apply?

2. If FBT issues DO apply, what is the simplest way to deal with the issue if a log book has been kept and the log book shows approx 90% business use (ie 10% private use) on less than 10,000 km per year. For example, can 10% of the car running costs not be claimed as a deduction (paid instead by the director personally) or is there still a need to register for FBT, record it and pay in the BAS statements etc?

We'd like the easiest possible way to handle the issue properly.

 

Thanks 

1 ACCEPTED SOLUTION

Accepted Solutions

Most helpful response

ATO Community Support

Replies 1

Hi @Prasa1,

 

I'll help answer your questions in a similar layout for ease Smiley Happy

 

1. Taken from the Fringe Benefits Tax (FBT) page on our ato website:

 
 For fringe benefits tax (FBT) purposes, an employee includes a:
     • current, future or past employee
     • director of a company

     • beneficiary of a trust who works in the business.
        
2. There is a need to register for FBT if an employer is liable to pay FBT during the FBT year (1 April to 31 March). @NateATO has provided some great information regarding this on a similar forum post'FBT related to car'. However, an employer's FBT liability may be reduced if the employee makes contributions through their personal 'after-tax' income. @StephATO has given some more details here regarding 'post-tax employee contributions to reduce FBT'.
   
If you require any further assistance, please feel free to keep posting Smiley Happy
    
RachATO

2 REPLIES 2

Most helpful response

ATO Community Support

Replies 1

Hi @Prasa1,

 

I'll help answer your questions in a similar layout for ease Smiley Happy

 

1. Taken from the Fringe Benefits Tax (FBT) page on our ato website:

 
 For fringe benefits tax (FBT) purposes, an employee includes a:
     • current, future or past employee
     • director of a company

     • beneficiary of a trust who works in the business.
        
2. There is a need to register for FBT if an employer is liable to pay FBT during the FBT year (1 April to 31 March). @NateATO has provided some great information regarding this on a similar forum post'FBT related to car'. However, an employer's FBT liability may be reduced if the employee makes contributions through their personal 'after-tax' income. @StephATO has given some more details here regarding 'post-tax employee contributions to reduce FBT'.
   
If you require any further assistance, please feel free to keep posting Smiley Happy
    
RachATO

Enthusiast

Replies 0

Thanks RachATO.