FBT 2025: Your Guide to Fringe Benefits Tax, What’s Changing, What to Watch, and How to Stay ATO-Compliant

It’s that time of year again — and no, we’re not talking about Easter eggs or end-of-quarter reports. March 31st marks the end of the Fringe Benefits Tax (FBT) year in Australia, and if you’re a business owner, this date should definitely be circled on your calendar.

Whether you’re new to FBT or just want to make sure nothing’s changed under your nose, this guide is here to help you understand:

• What FBT actually is (and what it covers)
• What’s changed for 2025
• What hasn’t changed (but still catches businesses out)
• What you should be doing right now
• How to avoid unnecessary tax or penalties

Let’s break it down, keep it simple, and make sure you’re in the ATO’s good books this year.

First Things First: What Is Fringe Benefits Tax (FBT)?

Fringe Benefits Tax (FBT) is a tax employers pay on non-cash benefits provided to employees or their associates. These are perks or extras provided in addition to salary or wages.

Common examples include:

• Company cars or utes
• Gym memberships
• Meal and entertainment expenses
• School fee payments
• Work-from-home devices
• Salary packaging and novated leases

FBT is calculated separately from income tax and is based on the taxable value of the benefits provided. Importantly, the FBT year runs from 1 April to 31 March, not in line with the standard financial year.

Learn more about how FBT works on the ATO site.

What’s Changed for the 2024–25 FBT Year?

The FBT rate remains at 47%, but key thresholds and caps have been updated. Specifically:

• The car fringe benefit statutory limit has increased
• Allowances such as Living Away From Home have updated limits
• Several COVID-19 concessions have expired, including those related to working from home and emergency provisions

The ATO has also doubled down on data matching and digital red flags. If your bookkeeping is fuzzy or your records are incomplete, you might get noticed.

Check the latest FBT rates and thresholds here.

What Hasn’t Changed (But Still Trips People Up)?

Despite the new thresholds, many of the classic FBT traps are still in play:

• Dual cab utes and other vehicles may still attract FBT, depending on private use
• Entertainment expenses (like team lunches or client dinners) aren’t always exempt
• Gifting employees: Even small perks can sometimes trigger an FBT liability
• Salary sacrifice arrangements still require careful documentation and timing

If you’re unsure, our Advisory & Tax Team can help you unpack it all.

What Should You Be Doing Today (or This Week)?

If you haven’t already ticked these off, it’s time to:

• Review all fringe benefits provided between 1 April 2024 and 31 March 2025
• Document everything: Logbooks, receipts, declarations, packaging agreements
• Calculate your FBT liability (or let us handle it)
• Prepare your FBT return
  • Lodgement due by 21 May if self-lodging
  • Due by 25 June if lodging through a registered tax agent like us
• Ensure timely payment to avoid penalties or interest

Need help reviewing your fringe benefits? Get in touch with Amarose Accounting.

2025 Salary Packaging & Employee Perks: Still Worth It?

Absolutely — when structured correctly. Smart salary packaging can be a win-win for employers and employees. But if not handled properly, it can trigger unnecessary tax and compliance headaches.

For example:

• A novated lease might save an employee thousands in tax, but only if properly reported
• A team Christmas party might seem tax-free, but if it exceeds the minor benefits threshold, FBT may apply

Want a better way to reward your team without gifting the ATO? Explore Profit First and business advisory options here.

Why Businesses Love Working With Us During FBT Season

At Amarose Accounting, we:

• Demystify the tax jargon
• Keep you ATO-compliant and audit-ready
• Help you design smarter staff benefit structures
• Ensure you don’t pay a dollar more than you have to

Plus, we bring a human-first, plain-English approach to every conversation. No stuffy suits. Just real advice from people who care.

Final Thoughts: FBT Isn’t Just About Avoiding Tax

It’s about:

• Taking care of your team
• Being strategic with your incentives
• Staying out of the ATO’s bad books

Handled well, fringe benefits can enhance your culture, retain top talent, and save money. Handled poorly? It’s a compliance nightmare.

So as this FBT year wraps up, take a breath, get your ducks in a row, and reach out if you need help.

📞 Need to speak with someone? Book a free discovery call with Amarose Accounting and one of our business accountants can answer your questions on FBT.