Reference no: EM133551061

Question: Allan's employer purchased a car in March 2019 at a cost of $44,000 GST inclusive and provided the car to Allan on 1 April 2019. Allan garages the car at his home each night during the 2019/20 FBT year. Allan travelled 40,000 kilometres in the car during the year, and the odometer and logbook records show that 10,000 kilometres were for business purposes and 30,000 kilometres were for private purposes. The operating costs of the car (not including deemed depreciation and deemed interest) were $9,000 (GST inclusive). Allan did not make any contribution but provided all the necessary documents for his employer to calculate his FBT liability. Question Assuming the employer elects to use the operating cost basis, explain and calculate the taxable value of the car fringe benefit and the FBT consequences for Allan's employer.