Certain benefits have been specifically exempted from Fringe Benefits Tax (FBT). In the right circumstances the business receives a deduction, no FBT applies and the employee receives a valuable benefit without an additional tax liability.

In some cases, these opportunities can create significant savings.

Electric vehicles remain the standout

If there is one FBT exemption that has genuinely changed the conversation around employee benefits, it is the electric vehicle exemption.

Eligible electric vehicles can currently be provided to employees without triggering FBT, provided the relevant conditions are met. Importantly, the exemption can also extend to many associated running costs, making the overall benefit particularly attractive.

For employees using salary packaging or novated lease arrangements, the savings can be substantial.

The concession has been one of the key drivers behind increased EV adoption in Australia and remains one of the most valuable employee benefits available from a tax perspective.

Recent Budget announcements and ongoing policy discussions have placed these concessions back in the spotlight. While some proposed changes and reviews are underway, the current rules continue to present a significant opportunity for businesses and employees considering an electric vehicle.

For many business owners, this is one of the few areas where the tax system still provides a genuinely generous concession.

Work related technology

Laptops, tablets, mobile phones and other work related portable electronic devices can also qualify for favourable FBT treatment where the relevant requirements are satisfied.

For many businesses these are tools employees genuinely need to perform their roles, making the benefit both practical and tax effective.

The same opportunity often extends to owner operators actively working within their businesses.

Professional development

Supporting employees through training, conferences and professional development can provide long term value to both the individual and the business.

Many work related education and training expenses can be provided without triggering FBT, creating an opportunity to invest in capability while maintaining tax efficiency.

The minor benefits exemption

One of the most underutilised concessions is the minor benefits exemption.

Where a benefit is valued at less than $300 (including GST) and provided infrequently and irregularly, it may fall outside the FBT regime altogether.

Think a bottle of wine to celebrate a milestone, a gift voucher recognising an achievement, flowers following a significant life event, or an occasional team lunch.

The key is ensuring the benefit remains genuinely occasional rather than becoming an expected entitlement.

Used appropriately, these small gestures can create goodwill without creating unnecessary tax consequences.

Why business owners should pay attention

These opportunities are often discussed in the context of employees, but they can be equally relevant for business owners and family members actively involved in the business.

The objective is not to replace salary or avoid tax. Rather, it is understanding the concessions that already exist and ensuring they are being used appropriately.

The takeaway

For business owners, the opportunity is not necessarily spending more. It's understanding where the tax system has deliberately chosen to provide concessions and ensuring those opportunities aren't overlooked.