The Australian Government has been making strides toward a cleaner transport future, and part of this effort includes revising tax
incentives for electric vehicles. One significant change is the upcoming phase-out of Fringe Benefits Tax (FBT) exemptions for plug-in
hybrid electric vehicles (PHEVs). If your business provides these vehicles to employees, it’s crucial to understand how the new rules will
impact you and what steps you should take before the deadline.
What’s Changing?
Since late 2022, certain electric car - battery electric vehicles (BEVs), hydrogen fuel cell
vehicles, and plug-in hybrids—have been exempt from FBT. However, starting 1 April 2025, PHEVs will no longer qualify for
this exemption, with a few exceptions for vehicles that were already under a financially binding commitment before this
date.
The phase-out of the PHEV FBT exemption is part of Australia’s broader push toward sustainable transport. While the transition may create
challenges for some employers, early planning and strategic adjustments can help mitigate the impact. If your business relies on PHEVs, now
is the time to review your commitments and ensure compliance before the deadline.
Our accountants can help you understand the ins and outs of electric vehicles and Fringe Benefits Tax.
Treasury has released exposure draft legislation for Payday Super that will require employers to pay superannuation at around the same time as salary and wages are paid to the employee. The changes are proposed to commence from 1 July 2026.