FBT Q&A – Novated lease of an e-bike

Question

We have recently had a number of staff enter into novated lease agreements for e-bikes.

Given e-bikes are not considered a ‘car’ benefit, what is the FBT treatment?

Answer

It is correct that an e-bike is not a ‘car’ for FBT purposes and so no car benefit arises where e-bikes are provided by way of novated lease.

However, the provision of an e-bike via a novated lease arrangement will result in a residual benefit arising. If the only private use of the e-bike consists of solely commuting to and from work and other private travel that is minor, infrequent and irregular, exemption from FBT is available.

ATO class ruling – CR 2015/80 – discusses the provision of e-bikes to employees by way of novated lease in detail.

 

This article provides a general summary of the subject covered and cannot be relied upon in relation to any specific instance. It is not intended to be, nor should it be relied upon as, a substitute for professional advice. TaxEd Pty Ltd and any person connected with its production disclaim any liability in connection with any use.