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fbt ev exemption

Determining Your Electric Vehicle’s Eligibility for FBT Exemption

In an era where environmental consciousness goes hand in hand with financial savings, understanding the FBT ev exemption can significantly impact your decisions as an electric vehicle (EV) owner. This exemption not only fosters a greener approach to commuting but also offers tangible benefits that align with both personal and corporate sustainability goals. Knowing if your electric vehicle meets the EV eligibility criteria for FBT exemption can translate into considerable savings, making it an essential step for every environmentally conscious driver.

This article is designed to guide you through the process of determining your electric vehicle’s eligibility for FBT exemption. We will delve into the FBT exemption qualifications, highlighting the criteria that your EV must meet to benefit from this exemption. Furthermore, we’ll provide a comprehensive list of eligible EV models, ensuring you have all the necessary information at your fingertips.


Criteria for EV Fringe Benefits Tax Exemption


General Requirements

To qualify for the FBT exemption, your electric vehicle (EV) must meet several key eligibility requirements. Firstly, it should be classified as a zero or low emissions vehicle, which includes battery electric vehicles, hydrogen fuel cell electric vehicles, and plug-in hybrid electric vehicles. However, note that from 1 April 2025, plug-in hybrids will no longer be considered low emission vehicles under FBT law unless specific conditions are met. Additionally, the vehicle must be first held and used on or after 1 July 2022 and should not have been subject to luxury car tax (LCT) at any point.


Specific Vehicle Types Eligible

For an EV to be eligible for the electric cars exemption, it must also be designed to carry a load of less than one tonne and fewer than nine passengers, including the driver. This definition excludes large work vans, motorcycles, scooters, caravans, and motor homes. It’s crucial to ensure that the EV is used by a current employee or their associates, like family members, for private purposes to qualify for this exemption.


Required Documentation

To successfully claim the FBT exemption, you must provide documentation proving that the EV was first held and used after 1 July 2022 and that it falls below the LCT threshold of $89,332 for fuel-efficient vehicles for the financial year 2023/24. Documentation should also confirm that the vehicle has never been subject to LCT in any previous transaction. If considering a novated lease for a used EV, ensure it was first used by the original owner after the specified date, as prior use disqualifies it from exemption.


List of Eligible Electric Cars


What Makes an EV Eligible?

To be eligible for the FBT exemption, electric vehicles (EVs) must satisfy several conditions. They must be either a battery electric vehicle, a hydrogen fuel cell electric vehicle, or a plug-in hybrid electric vehicle. Additionally, these vehicles should be designed to carry a load of less than one tonne and fewer than nine passengers, including the driver. The first time the car is both held and used must be on or after 1 July 2022, and luxury car tax (LCT) should never have been payable on the car’s importation or sale.

fbt ev exemption

This table is based on vehicles estimated to be below the LCT threshold as of December 2023. Note that on-road costs and modifications may affect eligibility for the FBT exemption.

Checking Your Vehicle’s Status

To check if your EV is eligible for the FBT exemption, ensure it meets the criteria outlined above. It’s crucial that the vehicle is a zero or low emissions vehicle, first held and used after 1 July 2022, and not subject to LCT in any previous transaction. For vehicles acquired via a novated lease, consult with your novated lease consultant or the dealer selling the car for confirmation on whether it is valued below the LCT threshold and thus exempt from FBT.


As we look towards the future, the significance of selecting and using electric vehicles in alignment with government incentives cannot be overstressed. The implications of such decisions extend beyond immediate fiscal savings, heralding a shift towards more sustainable commuting practices.

While the information provided here serves as a comprehensive guide, the evolving nature of tax laws and eligibility criteria encourages ongoing engagement with updated regulations. This pursuit of knowledge ensures that the benefits of electric vehicle ownership remain accessible, supporting both individual aspirations and broader environmental objectives.

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