Think Twice Before Posting Holiday Pics of Your FBT-Exempt Ute on K'gari
Think Twice Before Posting Holiday Pics of Your FBT-Exempt Ute on K'gari
The Ford Ranger has claimed its place as Australia’s top-selling vehicle. And yes, for tax purposes, it qualifies as a car.
But here's where it gets interesting: certain commercial vehicles like the Ranger can be provided to employees without attracting Fringe Benefits Tax (FBT). Even better? If you buy one through your business, and spend more than the car limit ($69,674 for the 2025-26 financial year), you are not limited in the amount of depreciation or GST you can claim
Let’s say you buy a Ranger for $88,000. You can claim the full $8,000 in GST and depreciate the entire $80,000 - no car limit restrictions. Plus, depending on how it's used, there may be no FBT to pay, even without a logbook.
Now compare that to buying a $88,000 petrol passenger car, like a Lexus. In this case, you can only claim 1/11th of the car limit back in GST (around $6,334), and you’re limited to depreciating just $69,674. Then, when you sell the car, you’ll still need to remit the full GST, even though you couldn’t claim it all upfront.
Plus, there’s the FBT to worry about. Without a logbook, the taxable value is calculated at 20% of the purchase price (less a few on-road costs), which comes in just under $17,000. The FBT payable on that is around $16,500 per year.
When compared to the tax treatment of a Ranger, it’s clear which one wins on paper.
But Here’s The Catch
The Ranger’s FBT exemption is conditional. It only applies if the vehicle’s private use is minor and infrequent.
Travel between home and work is fine - but the ATO has made it clear: private use should not exceed 1,000 km in total per year, and no single private trip should exceed 200 km.
The ATO might not be tracking your daily movements, but toll records and tech leave breadcrumbs. In addition, bear in mind one of their favourite audit tools: social media.
If you or your employee post photos of that Ranger parked on K’gari, or cruising down the coast more than 200 km from home, that’s a red flag.
The ATO could initiate an audit, request a logbook, and when you can’t provide one, they’ll point to your holiday post. Suddenly, you’re facing a $16,500-a-year FBT bill, plus penalties.
So, if you're operating a commercial vehicle under the FBT exemption, be smart. Minimise personal use, understand the limits, and maybe keep those holiday snaps off Facebook.
Important News About Car Thresholds
From 1 July 2025, the Australian Taxation Office has updated the car limit, GST credit cap, and Luxury Car Tax (LCT) thresholds for the 2025–26 financial year. The car depreciation limit is now $69,674—the maximum amount businesses can use to calculate vehicle depreciation when the car is first used or leased in the 2025–26 year.
For GST purposes, if your business buys a car priced above this threshold, the maximum GST credit you can claim is $6,334 (or 1/11 × $69,674), unless specific exceptions apply.
The LCT thresholds increase to $91,387 for fuel-efficient vehicles (≤ 7 L/100 km) and $80,567 for other cars, aligning with CPI adjustments. From 1 July, the definition of “fuel-efficient” will tighten to vehicles consuming between 3.5 and 7 L/100 km.
If you're considering a business car purchase, this change could affect depreciation deductions, GST claims, and potential LCT exposure. Be sure to consult your accountant for tailored advice.
