Cars & FBT Audits

Cars, being the most common and highest valued benefit, continue to be a major ATO focus.

Car and FBT audits
car and fbt audits icon

Beware! The ATO are targeting cars

Could you be a target?

Worried you could be the focus of the ATO's attention? Let us take care of your FBT obligations for you. Contact us

The ATO are targeting cars on a number of fronts...

Luxury cars and use of logbook - The ATO have focussed closely on the use of log books in respect of luxury vehicles, especially high end luxury sports cars.

Exempt Cars - The ATO have a major campaign targeting employers who have claimed exemption for vehicles and are not lodging FBT returns. The use of mail outs are used as a way to remind people that vehicles are not exempt merely due to the car type or body type; rather the need to evaluate the personal usage is critical.

Employee contributions project - Analysis by the ATO has identified that a high percentage of employers who report employee contributions in their FBT returns with the effect of reducing the taxable value of benefits, are failing to report those employee contributions as assessable amounts in their income tax returns.

The ATO are using a two pronged attack – contacting employers directly and also tax agents.

FBT obligations phone campaign - The phone campaign is aimed at ensuring employers are aware of their FBT obligations in relation to motor vehicles. The ATO is targeting those employers who have purchased a high value motor vehicle and do not have an FBT role. (ie are not lodging FBT returns)

Unreported car benefits - The ATO is undertaking an extensive campaign focusing on unreported car fringe benefits, targeting employers who have claimed the investment allowance, purchased new business vehicles but who have not lodged FBT returns.

Lapsed Lodgers - The ATO has increased the level of compliance action focused on 'lapsed-lodger' clients i.e. those employers who are 'dropping-out' of the FBT system. This is despite these employers continuing to employ staff and provide fringe benefits.

Tax agent change project - The ATO has identified a client population who either ceased reporting FBT altogether or the FBT liability significantly reduced following a change in tax agent. The ATO be reviewing more carefully this group and is likely to undertake a program of visits with tax agents with the purpose of reviewing practices in relation to FBT.