Yesterday, the Federal Labor Government announced changes to Fringe Benefits Tax methodology that will see the removal of the FBT Statutory Formula method for both salary-sacrificed and employer-provided cars.
Fleetcare is currently seeking advice on the full implications of the announced changes and will keep our clients informed about the implications once we ourselves, have a better understanding of this decision.
Following are the pertinent extracts from the Fact Sheet issued by the Federal Government.
This reform will remove the statutory formula method for both salary-sacrificed and employer-provided car fringe benefits for new contracts entered into after announcement, with effect from 1 April 2014.
Existing contracts materially varied after 16 July 2013 will also fall under the new arrangements. Existing contracts that are not varied will continue to have access to the existing statutory rate throughout the contract.
All car fringe benefits for new leases will be calculated using the operating cost method from 1 April 2014.
For the Federal Labor Government FBT Fact Sheet – please click here.