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.
Type 1 & Type 22025-26 rates
01 —INPUTS
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
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).
FBT calculation formula
Step 1: Grossed-up value = Taxable value × Gross-up rate
The most common car fringe benefit is a company or novated-leased car made available for an employee's private use. Two methods are allowed — the statutory formula (flat 20% of base value) and the operating cost method (business-use % × actual + deemed costs). Employers elect per car, per FBT year, and typically run both to pick the lower liability.
Battery electric and fuel-cell vehicles first held ≥ 1 July 2022 and priced under the fuel-efficient LCT threshold ($91,387 for 2025-26) are FBT-exempt, but the grossed-up notional value is still a Reportable Fringe Benefits Amount.
For method-specific numbers, use the Car FBT Calculator for side-by-side statutory vs operating-cost output with deemed depreciation, deemed interest, business-use % and the EV exemption check built in.
Common FBT exemptions
→Minor benefits: Under $300, provided infrequently and irregularly
→Work-related items: Portable electronic devices, tools of trade, protective clothing, briefcases (one per FBT year)
→Otherwise deductible rule: Benefits the employee could have claimed as a tax deduction
→Electric vehicles: Zero or low-emissions vehicles below the luxury car tax limit are FBT-exempt from 1 July 2022
→Salary sacrifice into super: Not a fringe benefit — taxed at 15%, not subject to FBT
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
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
Reviewed: March 2026 · Tax year: 2025-26
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.