A FBT motor vehicle employee declaration is a statement written by the employee outlining the fringe benefits they have received, and the percentage of business use and applicable reduction allowed, under the otherwise deductible rule.
A car fringe benefit only arises when the employer makes a car available to an employee for private use. The car is treated as being available for private use if:
- the car is stored at or near employee’s home; or
- where the place of employment and residence are the same; or
- not at employer’s premises and employee is able to use car for private purposes.
A car can be exempt from FBT – where the employee’s private use is a taxi, panel van or utility designed to carry less than 1 tonne, and the private use only includes the following:
- travel between home and work
- incidental travel in the course of performing employment-related travel
- non-work related use that is minor, infrequent and irregular (such as occasional use of the vehicle to remove domestic rubbish).
Where the motor vehicle is not a car, a residual fringe benefit may be provided to your employees.
A “no private use” declaration is required to be completed where the benefits are provided for employment purposes and there was no private portion. Depending on the type of fringe benefit provided, the applicable declaration should be completed.