Financial Services

Motor vehicle Fringe Benefits Tax (FBT) Policy

Further Information

Overarching Fringe Benefit Tax Policy


A car fringe benefit most commonly arises when a car, which is owned or leased by the University, is made available for the private use of an employee.

Policy statement

Cars are defined to include:

  • motor cars, panel vans and utilities (less than one tonne), four wheel drives and station wagons
  • any other goods-carrying vehicles with a designed carrying capacity of less than one tonne
  • any other passenger-carrying vehicles with a designed carrying capacity of fewer than nine occupants.

Private use

Private use is taken to include:

  • actual usage for private purposes by the employee
  • when the car is not at the University's premises and the employee is allowed to use it for private purposes
  • when the car is garaged at an employee's home or temporary accommodation such as a hotel, regardless of whether or not the employee has permission to use it privately
  • when the car is used by an employee for travel to and from work.

A faculty or a University "pool" car available for various employees to use for University business during the day that is garaged overnight by an employee, at a place other than on the University's premises, is deemed to be used for private purposes on that day.

Detailed records of these vehicles are required to be kept by the University in order to determine any fringe benefits tax FBT liability.

Possible exemptions

Private use of the car may be exempt if:

  • the car is a taxi, panel van or utility truck (designed to carry a load of one tonne or more), or other commercial vehicle not designed principally to carry passengers 
    and
  • the employee's private use of such a vehicle is limited to:
    1. travel between work and home
    2. travel which is incidental to travel in the course of employment duties
    3. non-work related use that is minor, infrequent or irregular.

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Calculation of car fringe benefits

The University mainly employs the statutory method to calculate the taxable value of a car fringe benefit.

Statutory method

The taxable value is calculated using the following formula:

A x B x C - E
      D

Where:

A =
The base value of the car
B =
The statutory percentage
C =
The number of days in the FBT year when the car was used or available for private use by University employee(s)
D =
The number of days in the FBT year
E =
The amount of any employee contributions.

Base value of the car

If the car is owned by the University, the aggregate of:

  • its original purchase price
  • fitted accessories that are not required for business usage (for example, air conditioning, car stereo)
  • dealer delivery charges
  • goods and services tax
  • customs duty

but does not include:

  • registration
  • stamp duty charges.

Where the car is leased to the University, the aggregate of:

  • market value at the time the lease commenced
  • goods and services tax
  • customs duty.

Where the car has been owned or leased for a period of four years the base value of the car will be reduced by one-third.

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Statutory percentage

Statutory percentage is determined by reference to the total number of kilometres travelled by the car for the whole year (this includes business and private usage).

If the car is owned or leased by the University for only part of an FBT year, it is necessary to work out the annualised kilometres (how many kilometres would have been travelled if the car was owned or leased for the whole year). The statutory percentage varies from year to year.

Days available for private use

Note: if your car is damaged and in a workshop for repairs, it is still taken to be available for your private use, unless it is damaged to the point that it is not roadworthy.

Also note that if your car is parked at an airport it is still taken to be available for your private use.

An opportunity to reduce your days available for private use occurs when the car is garaged at your employer's premises or other commercial storage facility and the keys are left in the custody of your employer.

Employee contributions

The taxable value of a car benefit is reduced by the amount of any contribution made by the employee in respect of fuel, oil, insurance, registration, repairs and maintenance.

The employee must supply documentary evidence of the expenditure (receipts or invoices) to the University or, in the absence of documentary evidence for fuel and oil costs, a declaration from the employee must be made to the University prior to lodgement of the FBT return.

The University will not be required to remit GST on this employee contribution as GST would have been paid when the employee incurred the costs and the University is not receiving consideration directly.

Documentation

It is essential, for the correct calculation of car fringe benefits tax, that the University obtain odometer readings at 31 March every year. Purchase price details and relevant dates of purchases and the like are also required.

Documentary evidence of all unreimbursed expenses, excluding petrol and oil, incurred by an employee must be supplied to the employer. For unreimbursed expenses in respect of petrol and oil, a declaration of the amount of the employee's expenditure may be supplied in place of documentary evidence.

When a car is made available to a number of University employees, adequate records (such as a logbook) must be kept to determine on which day(s) the car was available for private usage.

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Related forms

New vehicles

When a new vehicle is acquired by the University (via purchase or lease), a New Vehicles Fringe Benefits Tax Advice form is to be completed and forwarded to Financial Services Tax.If the new vehicle replaces an old vehicle, ensure the final odometer reading and the date the old vehicle was last held is clearly stated on the form as this detail will be required when pre-filling the final declaration forms for authorisation by the School. Ensure that BU and PG details are included.

Private use

This form is to be completed for University vehicles where there has been some private use. The form is sent to Schools by the Financial Services Tax team in the lead up to 31 March each year, or when a vehicle has been disposed of.

Unavailable for private use

This form is to be completed for University vehicles where it has been unavailable for private use sometime during the FBT year. The form is sent to Schools by Financial Services Tax in the lead up to 31 March each year, or when a vehicle has been disposed of.

Log book

Log books are to be completed for any vehicle being valued using the Operating Cost Method, or pool vehicles as determined by the School. UWA Log Books are available to print, or copies can be obtained from Financial Services Tax.

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Pool vehicles

This form is to be completed for University pool vehicles (other than utilities, vans and the like). The form is sent to Schools by Financial Services Tax in the lead up to 31 March each year, or when a vehicle has been disposed of. 

Exempt motor vehicle - no private use

This form is to be completed for University vehicles such as utilities, vans and the like where they have not been used for private purposes at any time during the FBT year. The form is sent to Schools by Financial Services Tax in the lead up to 31 March each year, or when a vehicle has been disposed of.

Exempt motor vehicle - private use

This form is to be completed for University vehicles such as utilities, vans and the like where they have been used for private purposes at some stage during the FBT year. The form is sent to Schools by Financial Services Tax in the lead up to 31 March each year, or when a vehicle has been disposed of.

Fuel expense declaration

Where an individual has paid for fuel/oil expenses for a University-owned vehicle without seeking reimbursement (that is, they paid for the expense from their own bank account), a Fuel Expenses Declaration can be completed which will reduce the FBT charge on the respective invoice. This is for UWA vehicles only – not for those leased via salary packaging.

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