The 2011-12 federal budget made a couple of significant changes.
Scale back of FBT concessions on company cars
The Government proposes changes to fringe benefits tax, which are intended to remove the current incentive for people to drive salary‑sacrificed and employer‑provided cars and to increase their tax concession. The measure is set to replace the current 'statutory formula' method for determining the taxable value of car fringe benefits by replacing the statutory rates with a single flat rate of 20 per cent that applies regardless of the distance travelled. This measure will apply to new arrangements entered into after 7:30pm (AEST) on 10 May 2011, and will be phased in over four years.
Scale back of FBT concessions on company cars
The Government proposes changes to fringe benefits tax, which are intended to remove the current incentive for people to drive salary‑sacrificed and employer‑provided cars and to increase their tax concession. The measure is set to replace the current 'statutory formula' method for determining the taxable value of car fringe benefits by replacing the statutory rates with a single flat rate of 20 per cent that applies regardless of the distance travelled. This measure will apply to new arrangements entered into after 7:30pm (AEST) on 10 May 2011, and will be phased in over four years.