Fringe benefit tax (FBT) is a tax on benefits that employees or shareholder-employees receive as a result of their employment, including those benefits provided through someone other than an employer.

The five main groups of fringe benefits are-
  • motor vehicles for private use
  • low-interest/interest-free loans
  • free, subsidised or discounted goods and services
  • employer contributions to sick, accident or death benefit funds, superannuation schemes and specified insurance policies.
  • Unclassified fringe benefits

Gifts, prizes and other goods are fringe benefits. If you pay for your employees’ entertainment or private telecommunications use, these benefits may also be liable for fringe benefit tax.

Refer to the IRD website for more information on how fringe benefit tax is applied and calculated.