Fringe Benefits Tax (FBT) is a tax that employers pay on certain non-cash benefits provided to employees or their associates such as family members, in addition to salary or wages. These benefits may include things like company cars, low-interest loans, or paid entertainment.
FBT is separate from income tax and is calculated based on the taxable value of the benefits provided. The tax ensures that employees receiving valuable perks are treated fairly under the tax system, even if those perks aren’t direct cash payments.
Employers are responsible for tracking and reporting these benefits, and paying the appropriate amount of FBT to the government.