From 1 July 2022 employers do not pay FBT on eligible electric cars.
ELECTRIC VEHICLES – WHAT ARE THE FBT INCENTIVES
From 1 July 2022 employers do not pay FBT on eligible electric cars.
A new initiative of the Labor Government [first of its kind – duped the Electric Vehicle strategy]. It was designed to encourage employers, individuals and families to purchase electric vehicles (EVs) in order to improve environmental outcomes.
The Electric vehicle policy introduced a range of tax incentives for employers effective the 12th of December 2022.The main being a Fringe Benefits Tax (FBT) exemption.
This FBT exemption will encourage businesses to purchase EVs for their vehicle fleet and will also reduce the cost where an employee enters a salary sacrifice agreement to purchase or lease an EV.
The FBT exemption applies to EVs acquired after the 1st of July 2022 where the EV:
- qualifies as a “zero or low emission vehicle”; and
- has an acquisition price that is less than the luxury car tax threshold (currently: $84,916).
The EV FBT exemption can offer a significant incentive for those individuals and businesses that are interested in acquiring EVs.
If you are interested in acquiring an EV for your business and would like to know how the EV FBT exemption may assist you in this purchase, or if you would like to know more, please contact us here at Hailston + Co.
