Electric Vehicles - Australian Tax Breaks

Electric & Hybrid Vehicles - Australian Tax Breaks

Sounds great but you need to be aware of the details

The ATO has announced tax breaks for electric vehicles, which is that for certain vehicles they will be exempt from Fringe Benefits Tax FBT. Where this can be a great benefit is for people with low business use or spouses who don’t have any business use.

What do you need to consider:

Cost

Vehicle must be the Luxury Car Tax Threshold of $84,916 (2023 year), be careful as this includes accessories. So with current pricing we are talking about the lower end vehicles ie Tesla

Hybrid

These are exempt till 1 April 2025, then they will be subject to FBT so its only for about 2 years. The only possible extension is if there is a financially binding commitment in place beyond this.

Second Hand

This is messy, as to be exempt you have to consider was Luxury Car Tax paid on the car when it was first sold, so you will need the initial purchase details not just what you are paying now.

Whilst the press announcements sounded great there is a lot of things you need to be aware of so to make sure you comply always check with your Accountant prior to signing any contract.