The recent Federal Budget saw the Government announce changes to the electric car Fringe Benefit Tax (FBT). If you’re considering buying or leasing an electric vehicle through work, here’s what you need to know.
From now until 31 March 2027
The current full FBT exemption remains in place until 31 March 2027. During this time, eligible battery electric vehicles (BEVs) and hydrogen fuel cell vehicles priced below the luxury car tax threshold ($91,387 for 2025–26) continue to be fully exempt from FBT.
From 1 April 2027
The current FBT exemption will continue to apply to electric cars valued at less than $75,000. Electric cars above this threshold will receive a 25% FBT discount instead.
From 1 April 2029
A permanent 25% discount on FBT will be applied to electric cars valued up to, and including, the fuel-efficient luxury car tax threshold. Electric cars that cost more than the fuel-efficient luxury car tax threshold will not qualify for the discount and will remain subject to the existing FBT rules.
While these incentives are still available for the time being, the changes may affect the timing and structure of any purchase.
If you are considering a new car and would like to understand how these rules may apply to your situation, please feel free to get in touch. I’d be happy to discuss your options and help you work through the most suitable approach.
