FBT Calculator 2027 – Car Fringe Benefits Tax (Statutory Formula)

How FBT on a car is calculated

Under the statutory formula method:

Taxable value = base value of the car × 20% × (days available for private use ÷ days in the FBT year) − employee contributions.
The taxable value is grossed up — multiplied by 2.0802 (type 1) or 1.8868 (type 2) — to represent the pre-tax salary the employee would have needed to buy the benefit.
FBT = grossed-up value × 47%.

The base value is generally the cost price including GST and dealer delivery, but not registration or stamp duty. After the car has been held for four full FBT years, the base value drops by one-third.

The alternative operating cost method uses actual running costs and a logbook to work out the business-use percentage. It can produce a lower value when business use is high, but it needs more records.

Worked example: a $45,000 car available all year

Base value $45,000, available all year, no contribution, type 1

The taxable value is 20% of $45,000 = $9,000. Grossed up at 2.0802 it becomes $18,721.80, and FBT at 47% is $8,799. If the employee paid $9,000 a year from after-tax salary, the FBT would fall to nil.

FBT payable by employer$8,799FBT year ending 31 March 2027

Taxable value: $9,000
Reportable fringe benefit: $16,981on the employee’s income statement
Contribution to eliminate FBT: $9,000

Base value × 20% × days/365: $9,000.00
Less employee contribution: $0.00
Taxable value: $9,000.00
Gross-up (type 1): 2.08
FBT rate: 47.0%
FBT payable: $8,799.25

FBT rates for the year ending 31 March 2027

Item	Value
FBT rate	47%
Type 1 gross-up	2.0802
Type 2 gross-up	1.8868
Reportable benefit threshold (taxable value)	$2,000
Statutory / benchmark interest rate	8.27%
Car parking threshold	$11.48 a day

These are unchanged from the previous year except for the benchmark interest rate (down from 8.62%) and the car parking threshold (up from $11.03).

Tips

Record odometer readings at the start and end of the FBT year for every car.
Days unavailable count. If the car was in for repairs or garaged while the employee was away and could not be used privately, reduce the days.
Exempt electric cars still need records, because the taxable value is reported on the employee’s income statement.
Minor benefits under $300 that are infrequent and irregular may be exempt.

Questions people ask

When does the FBT year run?

From 1 April to 31 March. The current FBT year ends on 31 March 2027, and the FBT return for it is due by 21 May 2027 if you lodge yourself.

What is the difference between type 1 and type 2?

Type 1 (gross-up 2.0802) applies when the employer can claim a GST credit for the benefit, as with most cars. Type 2 (gross-up 1.8868) applies when it cannot, such as with GST-free or input-taxed benefits.

When is a fringe benefit reportable?

When the total taxable value of certain benefits given to an employee in an FBT year exceeds $2,000. The grossed-up amount — at least $3,773 — appears on the employee's income statement.

Can the employee reduce the FBT?

Yes. An after-tax contribution from the employee reduces the taxable value dollar for dollar. Contributing the full taxable value reduces FBT to nil; this is how novated leases on petrol cars work.

This is an estimate based on published rates, not tax or financial advice. Your payslip or assessment may differ. We are an independent site, not affiliated with any government agency. Read the full disclaimer.

Fringe benefits tax (FBT) calculator