Calculate Inland Revenue (IRD) motor vehicle Fringe Benefit Tax (FBT): compare 20% cost price vs 36% depreciated tax value methods and find the lowest tax option.
36% Tax Value Method
Per 3-month FBT return
$307 annual savings
63.93% FBT rate applied
Original cost, tax book value, and private availability days.
Detailed side-by-side tax liability.
\text{Cost Price Method Benefit} = 20\% \times \text{GST-inclusive Cost Price} \times \left(\frac{\text{Days Available}}{365}\right) - \text{Employee Contribution} \\
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\text{Tax Value Method Benefit} = 36\% \times \text{Depreciated Tax Value} \times \left(\frac{\text{Days Available}}{365}\right) - \text{Employee Contribution} \\
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\text{Annual FBT Payable} = \text{Taxable Benefit Value} \times \text{FBT Rate (63.93\% flat or 49.25\% alternate)}Under NZ Inland Revenue rules, motor vehicles provided to employees that are available for private use attract Fringe Benefit Tax (FBT). Employers may choose between the Cost Price method (20% of GST-inclusive purchase price per year) or the Tax Value method (36% of depreciated book value per year). For depreciated vehicles, the Tax Value method often produces significant tax savings.
All calculations, amortizations, and scenario projections displayed on this page are strictly for informational and educational purposes. Nothing herein constitutes investment, financial, tax, or legal advice. Actual Reserve Bank of New Zealand (RBNZ) interest rates, IRD PAYE brackets, ACC Earner's Levy, KiwiSaver regulations, and lender criteria may vary. Calconova explicitly disclaims all liability for any decisions taken based upon these calculations. Consult a qualified financial advisor, CPA, or official Inland Revenue documentation prior to executing financial commitments.
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