Vehicle FBT .................................................................................................................................................................

INTERNALLY MANAGED OPERATING VEHICLE LEASE

FRINGE BENEFITS TAX

As part of your package you are asked to estimate the distance to be travelled annually for FBT
purposes, this figure is then used to set the FBT cost you will bear. Click here for examples of the
weekly, monthly and quarterly averages for the annual distances relating to each FBT rate .
The FBT rate is calculated using the Statutory Formula Method . The following percentages
are applicable.

* The FBT year is the 12 month period that ends on 31 st March.

FBT is calculated for the year ended 31 st March and at the end of your lease.

If your lease commences or finishes during the FBT year then the pro-rata kilometres travelled
for the year ended 31 st March are calculated to establish the FBT rate for that vehicle for the year
ended 31 st March. The following formula is used in this calculation:

A multiplied by C divided by B

Where:

• A equals the number of whole kilometres travelled in the period

• B equals the number of days in that period

• C equals the number of days in the FBT year (usually 365 except in a leap year when it is 366)

The FBT annual return year end date is the 31 st March each year and it is at this time you are
asked for the odometer reading of your vehicle. This reading is used to establish the annual FBT rate
for the vehicle.

If the number of kilometres travelled during the full 12 months between each 31 st March or the
calculated pro-rata kilometres are less than the minimum required for the estimated FBT rate
that you have agreed to, you will become liable for the additional FBT charges paid by the
University. However, if the annual kilometres travelled are more than the maximum required
for the estimated FBT rate that you have agreed to, you will be entitled to receive a credit for
the excess FBT that you have paid.

In both of these cases adjustments will be made for the Business Use Discount and Fuel
contribution that form part of your lease.

The following examples show how the FBT rules are applied.

A vehicle has an estimated FBT rate set at 20% based on the estimated 20,000 kilometres
that are planned to be travelled annually that commences on 1 st October 2003 and the FBT
year ends on 31 st March 2004.

(a) On 31 st March, 2004 , the odometer reading is 8,000 kilometres.

The calculation to establish the actual FBT rate for that vehicle is as follows:

8,000 kilometres divided by 182 days multiplied by 366 = an annualised distance of 16,088
kilometres which is more than the minimum kilometres of 15,000 kilometres required to qualify
for the 20% FBT rate. The 20% FBT rate applies for all vehicles that travel between 15,000
and 24,999 kilometres per annum. In this example, no additional liability is incurred for that
vehicle as the required pro-rata annual kilometres have been travelled by the vehicle.

(b) On the 31 st March 2005 the odometer reading is 22,999 kilometres.

The calculation used to establish the actual FBT rate is based on the odometer reading at the
end of the FBT year on 31 st March 2005 less the reading at the beginning of the FBT year
on 31 st March 2004 . The calculation is made as follows:

22,999 kilometres minus 8,000 kilometres = 14,999 kilometres travelled during the FBT year
ended 31 st March, 2005 . This is less than the minimum 15,000 kilometres required to qualify
for the 20% rate. Consequently additional FBT charges will be payable by the university.
(Please remember that a failure to achieve the minimum estimated kilometres for the
year ended 31 st March will incur additional FBT charges that are payable by the
university, and will be charged to the staff member using that vehicle.)

(c) The lease ends on 1 st October 2005 and at that time the odometer reading is 31,000
kilometres.

The pro-rata calculation is made as follows.

The distance travelled during the period 31 st March 2005 and 1 st October 2005 divided
by the number of days (184) for the period multiplied by 365. Thus:

31,000 minus 22,999 = 8,001 kilometres
8,001 divided by 184 multiplied by 365 = 15,871 kilometres which is more than the minimum
15,000 kilometres required to qualify for the 20% FBT rate. In this example, no additional
FBT charges are incurred as the estimated kilometres and the pro-rata kilometres meet the
requirements to qualify for the 20% FBT rate for the year.

Follow these links to the ATO FBT website for more information:

CAR FRINGE BENEFITS

http://www.ato.gov.au/businesses/content.asp?doc=/content/52015.htm

FBT CAR CALCULATOR

http://calculators.ato.gov.au/scripts/axos/axos.asp?CONTEXT=&KBS=FBT_car.xr4&go=ok

MOTOR VEHICLE UNAVAILABLITY

 If you do not have use of your vehicle for any period of time, you may be able to declare the
vehicle as being unavailable for the FBT annual calculations. Any FBT liability will be reduced
by any days where your vehicle is deemed unavailable for your use.

For your vehicle to qualify as being unavailable for FBT purposes the following circumstances
need to be satisfied.

• The vehicle is garaged on Swinburne property: and

• The keys to the vehicle are handed to the Fleet Manager who ensures that the vehicle is
  not available for private use by yourself or a family member: or

• The vehicle is being repaired and you do not have access for at least a 24 hour period.

Unavailability cannot be claimed if the motor vehicle is in safe storage or in long-term
car parking whilst you are interstate or overseas or on a holiday and can only be
recorded as full days

If you wish to declare unavailability please complete the Motor Vehicle Unavailability Declaration and
hand it along with your car keys to the Fleet Manager.

It is important to note that , regardless of any unavailability, you must still reach your
required kilometres by the end of the FBT year or your FBT liability may, in fact, be higher.

NOTICE TO STAFF

FBT FOR VEHICLES

 Where a staff member plans to travel an estimated annual number of kilometres so that
a desired FBT Statutory Formula Method Percentage is achieved, then it is the responsibility of
the staff member to ensure that the targeted kilometres are actually travelled for the year
ended 31 st March.

Any variations between the estimated and the actual annual kilometres travelled, which result
in the university having to pay for any additional FBT charges , will be collected from the
staff member.

Where the FBT charge is reduced , as a result of any variations between the actual and the
estimated number of annual kilometres travelled, then the staff member using that vehicle will
be entitled to a refund.

FBT STATUTORY FORMULA METHOD PERCENTAGES