FBT on Novated Vehicle

Sorry if this isnt the right place to post this - just have a question on FBT liablity on my novated vehicle.

My employer said there has been a shortfall in payments for FBT in 2012 tax year primary due to the valuation of the vehicle....

What happened was:
  • When i joined my employee the FBT value of the car - cost base was 57k
  • The finance ran out a year later, and instead of getting a new car, i refinanced the existing car for another year whilst i was still looking.
  • My novated leasing company adjusted the FBT cost base in the refinance amount down to the current market value of the car - to be 32k and restructured the payments.
  • Resulting was a drop in monthly payments to the leasing co....

My employer said this re-valuation should not have occurred on re-financing and is now requesting the shortfall in FBT as this is where it lies...

The leasing co believes it allowed to do this... :confused:

As the obligation is on the employer to collect the tax it seems there isnt much I can do. The employer also wants to collect it post tax, where as the leasing co says it can be pre-tax??!:confused:

If anyone has any advice here, it would be appreciated.
 
I can't answer any of your other questions.

I can't recall the ins and outs of refinancing but I know when I took my lease out nearly five years ago, it was not a good financial move to refinance. Did you do your due homework before you did this?

I thought you could only pay the FBT post tax, thats what I do.
 
Re-financing was only for a year to work out what to do - we were in the middle of a few things personally so wasnt in the mood for sourcing a new car for another 3 years at that time......

I can't answer any of your other questions.

I can't recall the ins and outs of refinancing but I know when I took my lease out nearly five years ago, it was not a good financial move to refinance. Did you do your due homework before you did this?

I thought you could only pay the FBT post tax, thats what I do.
 
Yeah, they can't readjust the cost base of the vehicle until the car is 4 years old. So if you car was younger than this then unfortunately I think you'll have to pay the money.

My car lease company tried to do this to me too, but thankfully I suspected it was incorrect and looked it up.
 
I know when we looked at refinancing, they could only use the residual value rather then the primary value if we had a break of about three months between leases.
 
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