Private ruling: Travel expenses
Date of advice: 13 March 2026
Published: 29 June 2026
Ruling period: Fringe Benefits Tax (FBT) Year Ended 31 March 20XX | FBT Year Ended 31 March 20XX | FBT Year Ended 31 March 20XX | FBT Year Ending 31 March 20XX | FBT Year Ending 31 March 20XX | FBT Year Ending 31 March 20XX
Date scheme commenced: 1 April 20XX

Ruling: Q1: Is the home to work travel when transporting bulky equipment in a car, considered a business journey in accordance with section 136 of the Fringe Benefits Tax Assessment Act 1986 (FBTAA) when determining the business use percentage under section 10 of the FBTAA? | A1: Yes | Q2: Is the home to work travel when transporting bulky equipment considered work-related travel in accordance with section 136 of the Fringe Benefits Tax Assessment Act 1986 (FBTAA) when determining the private use of a vehicle under subsection 47(6) of the FBTAA? | A2: Yes


Relevant legislative provisions: Fringe Benefits Tax Assessment Act 1986 s ection 7 | Fringe Benefits Tax Assessment Act 1986 section 8 | Fringe Benefits Tax Assessment Act 1986 section 10 | Fringe Benefits Tax Assessment Act 1986 section 47 | Fringe Benefits Tax Assessment Act 1986 subsection 136(1) | Income Tax Assessment Act 1997 subsection 8-1(1)

Reasons for decision: Summary: Yes, provided the home to work travel meets the criteria including that: | Detailed Reasoning - What is a car?: Under subsection 136(1) of the FBTAA, a 'car' has the meaning given by subsection 995-1(1) of the Income Tax Assessment Act 1997 which states: Car means a *motor vehicle (except a motor cycle or similar vehicle) designed to carry a load of less than 1 tonne and fewer than 9 passengers. Paragraph 11 of Miscellaneous Taxation Ruling MT 2024 Fringe benefits tax: dual cab vehicles eligibility for exemption where private use is limited to certain work-related travel to calculate the designated load capacity of a vehicle is to be taken as the gross vehicle weight reduced by the kerb weight. As per the list of vehicles provided, most of the vehicles are designed to carry a load of less than 1 tonne and fewer than 9 passengers and would therefore be considered a car. | Detailed Reasoning - What is a car benefit?: As per subsection 7(1) of the FBTAA, a car benefit is provided where: (a) at any time on a day, in respect of the employment of an employee, a car held by a person (in this subsection referred to as the provider ): (i) is applied to a private use by the employee or an associate of the employee; or (ii) is taken to be available for the private use of the employee or an associate of the employee; and (b) either of the following conditions is satisfied: (i) the provider is the employer, or an associate of the employer, of the employee; (ii) the «car» is so applied or available, as the case may be, under an arrangement between: (A) the provider or another person; and (B) the employer, or an associate of the employer, of the employee; that application or availability of the car shall be taken to constitute a benefit provided on that day by the provider to the employee or associate in respect of the employment of the employee. | Detailed Reasoning - Meaning of "private use": "Private use" is any use of the car by the employee that is not exclusively in the course of producing assessable income of the employee under subsection 136(1) of the FBTAA. "Producing assessable income" includes gaining assessable income or carrying on a business for the purpose of gaining or producing assessable income. Therefore, any employment-related use of the car by the employee would not be private use. Further, any use giving rise to other assessable income of the employee not related to employment would also not be private use. Subsection 7(2) of the FBTAA states: Where, at a particular time, the following conditions are satisfied in relation to an employee of an employer: (a) a car is held by a person, being: (i) the employer; (ii) an associate of the employer; or (iii) a person (other than the employer or an associate of the employer) with whom, or in respect of whom, the employer or an associate of the employer has an arrangement relating to the use or availability of the car; (b) the car is garaged or kept at or near a place of residence of the employee or of an associate of the employee; the car shall be taken, for the purposes of this Act, to be available at that time for the private use of the employee or associate, as the case may be. As per the facts provided, the employees can take the vehicles home at night. It is required that private use be kept to a minimum. Employees who are on-call are also provided with vehicles to facilitate their duties, and these vehicles can be used when attending personal and social events in order to remain prepared for ready to go out on a call, it is impractical for employees to go home or to pick up the work vehicle. As the vehicles are able to be garaged at the employee's place of residence and can be used for personal purposes while on call, it is considered that the vehicles are available for private use. Therefore, as a car has been provided to an employee and the car is available for private use, a car benefit is provided. | Detailed Reasoning - Taxable value of a car fringe benefit under the operating cost method: Section 10 of the FBTAA outlines the operating cost method in determining the taxable value of a car fringe benefit during the period over which the benefit arises. This method calculates the taxable value based on the car's operating costs during an FBT year, adjusted by the business percentage and any contributions made by the vehicle's recipient. Subsection 10(2) of the FBTAA outlines the formula for calculating the taxable value, which is: Taxable value = [C x (100% - BPI)] - R Where: • (C) is the operating cost of the car during the holding period; • (BP) is the business use percentage, and • (R) is any payment made by the recipient. Employers using the operating cost method of valuing a car fringe benefit must ensure that various records are kept showing the total car expenses incurred during the relevant period and the proportions of business and non-business use of the car. 'Business kilometre' is defined in subsection 136(1) of the FBTAA to mean 'a kilometre travelled by car in the course of a business journey'. | Detailed Reasoning - Meaning of 'business journey': The term 'business journey' is defined in subsection 136(1) of the FBTAA as follows: (a) For the purposes of the application of Division 2 of Part III in relation to a car fringe benefit in relation to an employer in relation to a car - a journey undertaken in a car otherwise than in the application of the car to a private use, being an application that results in the provision of a fringe benefit in relation to the employer;... This definition requires consideration as to whether the journeys undertaken by the employees are private in nature. This is the same consideration required to determine the deductibility of travel between home and work in terms of section 8-1 of the Income Tax Assessment Act 1997 (ITAA 1997). | Detailed Reasoning - Does the employee's travel constitute a business journey?: Subsection 8-1(1) of the ITAA 1997 relevantly provides that: You can deduct from your assessable income any loss or outgoing to the extent that: (a) it is incurred in gaining or producing your assessable income; or (b) it is necessarily incurred in carrying on a business for the purpose of gaining or producing the assessable income. However, as per subsection 8-1(2) of the ITAA 1997, an employee cannot deduct an amount to the extent that the outgoing is of capital, private or domestic nature, or relates to the earning of exempt income. Generally, expenses incurred by a taxpayer in travelling between home and work are not deductible under section 8-1 of the ITAA 1997 as they are considered to be private in nature. This is because normally, expenses incurred in travelling from home to work are not treated as incurred in the derivation of assessable income but instead are treated as incurred in order to enable the taxpayer to derive assessable income. This well-established principle was reinforced by the High Court in Lunney & Hayley v. Federal Commissioner of Taxation (1958) 100 CLR 478 (Lunney & Hayley). The High Court's reasons in Lunney & Hayley for the general principle of non-deductibility of home to work travel are twofold: Whilst it is necessary for a taxpayer to arrive at work to derive income, they do not start deriving that income until they actually arrive at work. As such, their travel expenses are a prerequisite to the earning of their assessable income, rather than being incurred in the course of gaining that income. The essential character of expenses incurred in travelling from home to work are of a private or domestic nature, as they relate to the taxpayer's personal and living expenses as part of the taxpayer's choice of where to live and at what distance from work. Therefore, the expenses would not satisfy subsection 8-1(2) of the ITAA 1997. However, subsequent court decisions have modified this general principle in various circumstances. For example, Federal Commissioner of Taxation v. Vogt 75 ATC 4073; 5 ATR 274 ( Vogt's Case ), whereby it was found that exceptional circumstances exist, under which a taxpayer may be entitled to a deduction for direct home to work travel expenses, for example: (1) If taxpayer has a home office which is a place of business; (2) If taxpayer has to carry bulky equipment; or (3) If taxpayer has shifting places of employment. This has also been addressed in Miscellaneous Taxation Ruling MT 2027 Fringe benefits tax: private use of cars: home to work travel where it states in limited circumstances the use of a car may be attributable to the necessary carriage of equipment rather than travel to and from work, as such, accepted as business travel. However, the approach should be followed where the employee performs duties at a number of places requiring the transport and use of substantially bulk such as to justify the need for a motor vehicle to transport it and where there are sound reasons for keeping the equipment at home. | Detailed Reasoning - Bulky equipment: Paragraph 79 of Taxation Ruling 2021/1: Income tax: when are deductions allowed for employees' transport expenses (TR 2021/1) explains that where the nature of the employment creates a practical necessity due to work duties, to transport bulky equipment, to and from a regular place of work (including to and from home), the expenses of transporting that bulky equipment may be deductible - It is construed by the Commissioner as a narrow exception to the ordinary principle that travel from home to a regular place of work is private and thus not deductible. A footnote at paragraph 79 of TR 2021/1 provides further explanation on the meaning of 'bulky': It is a question of fact whether equipment is bulky. In Crestani and Commissioner of Taxation [1998} AATA 612, Senior Member Block stated at [7]: I do not think that the term 'bulky' should be construed to refer to only an article which is of large size, such as the musical instruments which were the subject of the decision in FC of T v Vogt 75 ATC 4073. The term is, in my view, more aptly construed as similar to 'cumbersome' in the sense that it is not easily portable. Paragraph 80 of TR 2021/1 provides that, to come within this exception, it is necessary that: • the equipment is essential for the performance of the employee's employment duties • the equipment is bulky such that transportation by car or other private vehicle is the only realistic option, and • transporting the items to and from their regular place of work is a practical necessity because there is no secure area for the storage of the equipment provided at the employee's regular place of work or the equipment needs to be transported to a different site each day. | Detailed Reasoning - Application to your circumstances: Equipment essential to performance of employee's duties Travel is a fundamental part of the employee's work. The organisation provided some of its employees with passenger vehicles (cars for FBT purposes) so that they can carry out their employment duties. Each employee consistently travels from one work site to another, typically visiting multiple sites before returning home on any given day, irrespective of whether they are on-call or not. On occasions, whilst travelling home, employees may patrol past worksites that are located on their route home and, if they see an issue at the worksite, they are required to stop, put on their PPE before entering the premises, and asses the issue. Employees who are on-call are also provided a vehicle and these vehicles can be used when attending personal/social events to remain prepared for callouts. Due to the extensive equipment required and the requirement to always be responsive, it is impractical for employees to return home or pick up their work vehicle when undertaking a callout. The equipment is required to perform the inspections and therefore, this condition is met. The equipment is bulky Employees are required to carry various equipment, such as (for example) a toolbox, kitbag, storage containers for reusable PPE, first aid kits etc. Two specific examples have been provided by the organisation, showing the typical size and weight of the equipment carried by employees. It has also been stated that, on average, the equipment carried by individual employees weighs 54kg. The size and weight of the equipment provided to employees, is considered bulky such that transportation by car or other private vehicle is the only realistic option. An assumption has been included that all employees transport bulky equipment. Therefore, this condition has been satisfied. Practical necessity of transportation to and from places of work The equipment carried by the employees is bulky and the duties of employment require the equipment is stored in the vehicle as there is no other secure storage area available. It is accepted that the carrying of bulky equipment in the vehicle arose out of the nature of the employees' duties and not as a matter of personal choice. Therefore, there is a work-related necessity to transport the equipment in the vehicle when travelling between home, the regular place of work and inspection locations. | Detailed Reasoning - Conclusion: The equipment transported in the car has been determined to be bulky. The equipment is required for the employees to perform their duties and there is no secure storage provided by the organisation to store the equipment. Therefore, the trips between home and work transporting the equipment are not considered private in nature under section 8-1 of the ITAA 1997 Therefore, they are business journeys defined in subsection 136(1) of the FBTAA and classified as a 'business journey' for the purpose of calculating the taxable value of car fringe benefits under section 10 of the FBTAA. | Detailed Reasoning - Question 2: Is the home-to-work travel when transporting bulky equipment considered work-related travel in accordance with subsection 136(1) of the FBTAA when determining the private use of a vehicle under subsection 47(6) of the FBTAA? | Summary: Yes. The travel between home and work is considered work-related travel. | Detailed Reasoning - Detailed reasoning: Some of the vehicles in the list provided, are designed to carry a load over 1 tonne, and therefore do not meet the definition of cars under subsection 136(1) of the FBTAA. Section 45 of the FBTAA provides that a benefit is a residual benefit (for the purposes of this Act) if the benefit is not a benefit by virtue of a provision of Subdivision A of Divisions 2 to 11 (inclusive). Subsection 47(6) of the FBTAA provides an exemption where: (a) a residual benefit consisting of the provision or use of a motor vehicle is provided in a year of tax in respect of the employment of a current employee; (aa) the motor vehicle is not: (i) a vehicle used for taxi travel (other than a limousine) let on hire to the provider; or (ii) a car, not being: (A) a panel van or utility truck; or (B) any other road vehicle designed to carry a load of less than 1 tonne (other than a vehicle designed for the principal purpose of carrying passengers); and (b) there was no private use of the motor vehicle during the year of tax and at a time when the benefit was provided other than: (i) work-related travel of the employee; and (ii) other private use of the motor vehicle by the employee or an associate of the employee, being other use that was minor, infrequent and irregular; the benefit is an exempt benefit in relation to the year of tax Work-related travel, in relation to an employee is defined in subsection 136(1) of the FBTAA to mean: (a) travel by the employee between: (i) the place of residence of the employee; and (ii) the place of employment of the employee or any other place from which or at which the employee performs duties of his or her employment; or (b) travel by the employee that is incidental to travel in the course of performing the duties of his or her employment. | Detailed Reasoning - Conclusion: It has been determined (under Question 1) that the equipment being transported by the employees is bulky equipment. As per the definition of work-related travel, the travel between home and work transporting the equipment is considered 'work-related travel' under subsection 47(6).

Travel is a fundamental part of the employee's work. The employment agreement for the employees requires them to travel for their employment duties and to travel to multiple locations to perform their work. | The organisation provides some of its employees with passenger vehicles. Other than when employees are on-call, these vehicles are only to be used for predominately work purposes, however under certain criteria employees can take the vehicles home each evening, and any private use is to be kept to a minimum. | All vehicles are fitted with electronic devices which produces an electronic logbook and therefore allows the operating cost method to be applied when determining any FBT liability that arises in respect of the provision of the car. | In each vehicle, there are IVMS tracking system to record the various journeys the employees taken every day. | Each employee consistently travels from one work site to another, typically visiting multiple sites before returning home on a given day, irrespective of whether they are in an on-call arrangement or not. | During on-call periods, employees must be available for emergency responses and therefore, the equipment is always held within the vehicles provided by the organisation. | Other than by private vehicle, there is no other practical way of getting the employees equipment to the inspection sites as it is not possible to store the equipment at the inspection sites as these are separate client locations and the equipment is too bulky to transport via public transport. | All employees are allocated the same equipment, and at a minimum, 90% of the total equipment provided to the employees will be required to be carried to perform the inspections. Additional equipment may be required to be brought for specific call outs. | Transporting the equipment to and from the employee's regular place of work is required as there is no secure storage area for the storage of the equipment at the employee's regular place of work. | As the equipment stored in the boot of the vehicle is quite cumbersome, it eliminates the use of the boot of the vehicle for any other purposes. | Employees are only required to wear PPE whilst onsite, they do not wear this outside of the inspection. | The equipment carried by the employees vary, however on average, the total weight of the equipment required is approximately 54kg. | Assumptions: All inspectors are transportingthe equipment as listed for Inspector 1 and Inspector 2 in their vehicles when travelling from home to work. | Reasons for decision: These reasons for decision accompany the Notice of private ruling for the organisation. | This is to explain how we reached our decision. This is not part of the private ruling.