Vehicle FBT Reporting
Electronic Log Books
Navman Wireless Electronic Log Books
1. Background
2. Working Example
3. Where Navman Wireless come in
4. Return on Investment
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Background
•
FBT is a tax paid on all work vehicles that are also made available for PRIVATE use
•
There are 2 methods to calculate your FBT liability each year:
Method
How
Motivation
Statutory
Fraction
Estimate using a standard formula
Easy to do
Operating Cost
Actual vehicle costs and business / private Cost savings
use provided via 12 week log-book
More accurate
•
The Henry Report in 2011 legislated that Statutory Fraction will now be 20% across all
distances and applicable vehicle classes. This is a 3-fold increase in FBT liability for
vehicles doing more than 40,000Km a year
•
Statutory fraction is now increasing the tax burden on businesses and affecting the
bottom line
Which method to use?
• Already using Statutory Fraction?
– Tax savings if move to Operating Cost
– Achievable by using Navman Wireless automated log books
– Introduce visibility of fleet utilisation and operating costs of your fleet
• Already using Operating Cost?
–
–
–
–
Reduce back-office administration costs through automation
Eliminate hassle and negativity of paper log books
Increase visibility of fleet utilisation and operating costs of your fleet
Accuracy across 365 days allows you to identify the 3 months of the year that
best reflect your true private use
Working Example
•
$35,000 vehicle with the following typical running costs
Maintenance
and Repairs
$1000
Petrol
$3,276
9L fuel per
100km. Fuel
= $1.40/L
Distance
26,000km
Insurance
$750
Rego
$750
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Working Example : Statutory Fraction
Simple method which applies a fixed % to the taxable value of a car
Taxable
Value
Taxable
Value =
Stat Frac
X Base Value of Car X Days available 1
1
– Days available is Days in FBT Year divided by Days available for private use – typically 365 days unless car
stays on site every day
Year
Statutory
Fraction
Base Value
Private %
Taxable Value
FBT Paid
1
17%
$35,000
100%
$5,950
$5,712
2
20%
$35,000
100%
$7,000
$6,720
3
20%
$35,000
100%
$7,000
$6,720
TOTAL =
$19,152
FBT Paid = Taxable Value * 2.0647 * 46.5%
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Working Example : Operating Cost
This method takes into account all the costs of operating the vehicle for each tax
year e.g. fuel, lease cost, maintenance, rego etc. It then applies a true private use
% to the value of the vehicle derived from log-books over a continuous 12 week
period. Assumes private KMs are 10%.
Taxable
Value
Taxable
Valu =
Year Operating
Costs
Operating Cost
X
Private Use %
Lease Cost
Private %
Taxable Value
FBT Paid
1
$5,776
$40,776
10%
$4,077
$3,914
2
$5,776
$40,776
10%
$4,077
$3,914
3
$5,776
$40,776
10%
$4,077
$3,914
TOTAL =
$11,742
FBT Paid = Taxable Value * 2.0647 * 46.5%
Lease Finance costs not included in above Operating costs
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Where Navman Wireless come in
• Automates paper-less log-book collection
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Where Navman Wireless come in
• Make Operating cost model achievable for large company fleets
• Allows businesses to monitor and control PRIVATE use and limit their FBT
exposure
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Return on Investment
•
•
Potential tax saving
moving to Operating cost
model
Method
FBT Payable
Operating Cost (10% Private)
$11,742
Statutory Fraction
$19,152
Difference per vehicle (3 Years)
$7,410
Difference per vehicle (Annual)
$2,470
Reduce cost if on Operating cost model
Cost
Reduction
Annual Saving
Reduce head-count to process paper log books
1 FTE per 100
vehicles
$60,000
Reduce driver time ($30/hr) to produce log
books
25mins per week
$625 per driver
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The End