Class Ruling CR 2025/62

What this ruling is about: 1. This Ruling sets out the fringe benefits tax (FBT) consequences for those employers that enter into an arrangement with Interleasing (Australia) Limited (Interleasing) to utilise the Digital FBT Logbook within the Interleasing software suite, for car logbook and odometer recording purposes. 2. Details of this scheme are set out in paragraphs 12 to 27 of this Ruling. 3. All legislative references in this Ruling are to the Fringe Benefits Tax Assessment Act 1986 (FBTAA). Note: by issuing this Ruling, the ATO is not endorsing this product. Potential purchasers or users must form their own view about the product. Who this Ruling applies to 4. This Ruling applies to you if you are an employer who enters an arrangement with Interleasing to utilise the Digital FBT Logbook for FBT recording purposes within Interleasing's software suite. When this Ruling applies 5. This Ruling applies from 1 April 2025 to 31 March 2029. Logbook record 6. The reports generated by the Digital FBT Logbook through the Driver Manager system satisfy the definition of 'log book records' for the purposes of subsection 136(1) provided: Odometer records 7. The reports generated by the Digital FBT Logbook through the Driver Manager system satisfy the definition of 'odometer records' in subsection 136(1). Requirements of section 10A in a logbook year of tax 8. An employer in a logbook year of tax will satisfy the requirements of section 10A and is entitled to claim a reduction of operating costs if they use the reports generated by the Digital FBT Logbook through the Driver Manager system continuously for the: 9. An employer in a logbook year of tax who uses the Digital FBT Logbook continuously for the duration of the 'applicable log book period' as that term is defined in subsection 162H(1), but does not use the Digital FBT Logbook continuously for the whole of the 'holding period' as defined in section 162C, satisfies the requirements of section 10A and is entitled to claim a reduction of operating costs provided the employer: Requirements of section 10B in a non-logbook year of tax 10. An employer in a non-logbook year of tax that uses the Digital FBT Logbook continuously for the whole of the holding period (as defined in section 162C) satisfies the requirements of section 10B and is entitled to claim a reduction of operating costs. 11. An employer in a non-logbook year of tax who has used the Digital FBT Logbook in one of the previous 4 FBT years continuously for an 'applicable logbook period', but does not use it in that year of tax or for the whole of the period that the car is held, satisfies the requirements of section 10B. They will be entitled to claim a reduction of operating costs of the car on account of business journeys undertaken in the car during the holding period, provided the employer: 12. The following description of the scheme is based on information provided by the applicant. If the scheme is not carried out as described, this Ruling cannot be relied upon. 13. Interleasing provides asset finance, vehicle sourcing and fleet management services to its fleet customers. These services are supported by a technology portal known as Interleasing Connect. 14. Within Interleasing Connect is a system called Driver Manager, which hosts a range of online tools. 15. One such online tool is the Digital FBT Logbook. The Digital FBT Logbook is a cloud-based web application developed to replace traditional manual logbooks. 16. Drivers can access the cloud-based web enabled application, either on their mobile device or computer allowing them to input odometer readings, classify journey information and record the purpose of each journey. 17. The Digital FBT Logbook includes the option to select whether the trip is a personal or business trip. Where it is a business trip, it prompts the employee to include customised or free-text descriptions of the purpose of the business trip. 18. The Digital FBT Logbook delivers reminders to users to complete the logbook if no entries are made for a customer-defined period and sends alerts reminding drivers to complete the Digital FBT Logbook. It also automatically calculates business kilometres and business use percentage over the logbook period. 19. Drivers are required to classify their trips as soon as reasonably practicable after each journey. 20. Drivers can access the Digital FBT Logbook by logging into Driver Manager which has secure login protocols. Additionally, the logbook can be integrated with an optional telematics device to capture trip data in real time. 21. The Interleasing Digital FBT Logbook records the start and end dates and times of each journey in one of 2 ways: 22. The Digital FBT Logbook may be used with a device other than the car's odometer fitting by the car's manufacturer, such as a device with global positioning system (GPS) capability. 23. All journey information is collected and reported in English, and reports can be exported in multiple formats for data analysis and record keeping, including Excel, comma-separated values (CSV), hypertext markup language (HTML), and portable document format (PDF). 24. The Interleasing Digital FBT Logbook Report provides details of the following: 25. The reporting can be provided for any period up to the whole of the 'holding period'. 26. The Digital FBT Logbook stores all historic logbook data. The data is only offloaded from the system should a fleet employer cease using Interleasing's services, and request that Interleasing remove all stored data from their system. 27. Only authorised Interleasing staff have access to the Interleasing Connect systems and reporting processes. Interleasing staff are employed under strict probity-checking conditions and authorised staff are provided with a secure multi-factor authenticated login process. Commissioner of Taxation 17 September 2025 What is the operating cost method under section 10? 28. Section 10 allows employers to elect to calculate the taxable value of a car fringe benefit using the cost basis method (operating cost method). 29. Where the election is made, the taxable value of a car fringe benefit using the operating cost method is calculated according to the following formular in subsection 10(2): (C × (100% − BP)) − R 30. Therefore, an employer intending to claim a reduction in the operating cost of a car, on account of business journeys undertaken during the holding period, must meet the requirements of either section 10A (if the year is a 'log book year of tax' (as defined in paragraph 32 of this Ruling)) or section 10B (if the year is not a 'log book year of tax'), as applicable. Does the Digital FBT Logbook meet the relevant requirements of section 10A? 31. Section 10A states: 32. Section 162G sets out various circumstances under which a particular year can be treated as a 'log book year of tax'. It is accepted that all employers using the Digital FBT Logbook will make an election under paragraph 162G(1)(b) to treat the relevant current year of tax as a 'log book year of tax'. Does the Digital FBT Logbook satisfy the requirements of the definition of 'log book records' under subsection 136(1)? 33. Subsection 136(1) defines 'log book records' as: 34. A logbook record is essentially a daily logbook or similar document which contains an entry for each business journey made in the car during the period (paragraph (a) of the definition of 'log book records' in subsection 136(1)) that the holder of the car chooses to record in the document for the purposes of demonstrating the pattern of use of the car during the relevant period (paragraph (b) of the definition of 'log book records' in subsection 136(1)). 35. Paragraph (c) of the definition of 'log book records' in subsection 136(1) requires the date on which the journey began and ended to be entered in the relevant records. The Digital FBT Logbook records the start and end dates and times of each journey, and this information is detailed in the reports it generates. Therefore, this requirement is satisfied. 36. Paragraph (d) of the definition of 'log book records' in subsection 136(1) requires the respective odometer readings of the car at the beginning and at the end of the journey be entered into the relevant records. 37. The term 'odometer' is not defined in either the FBTAA or the Income Tax Assessment Act 1997, but the Macquarie Dictionary defines that term as being, 'an instrument for measuring distance passed over, as by a motor vehicle'. [1] 38. The term 'odometer records', as defined in subsection 136(1), makes reference to 'odometer reading of the car'. While odometer readings must pertain to the car, it does not necessarily mean that they must also be attributable either wholly or in part to the rotation of the car's wheels, thereby mechanically moving the standard odometer fitted in the car by the manufacturer. 39. Provided the GPS device used to determine the car's odometer readings is of sufficient integrity, it is accepted that a system other than the car's own odometer may meet the legislative requirements of the FBTAA. 40. Each time the car is driven, the start and end odometer readings for the journey are calculated from a telematics device with GPS capability. It is accepted that the opening and closing odometer readings calculated by the Digital FBT Logbook is of sufficient integrity to be odometer readings of the car. 41. It is accepted that the opening and closing odometer readings for each car journey detailed in the Digital FBT Log book Report satisfies the requirements of paragraph (d) of the definition of 'log book records' in subsection 136(1). 42. The number of kilometres travelled by the car in the course of each journey is also detailed by the Digital FBT Logbook Report thus satisfying the requirement of paragraph (e) of the definition of 'log book records' in subsection 136(1). 43. Paragraph (f) of the definition of 'log book records' in subsection 136(1) requires the purpose or purposes of the business journeys to be recorded. Further, the definition of 'log book records' requires that entries be made at, or as soon as reasonably practicable after, the end of the journey. 44. The classification of a journey as being for business use or private use is input by the driver by logging into the cloud-based application via their mobile device or their computer at the end of each car journey. For business journeys, the driver must also enter the purpose of the trip. 45. It is expected that the purpose recorded for each business journey is sufficiently descriptive to enable the journey to be classified as a business journey and that the relevant classification and description will be made at the end of each journey or as soon as reasonably practicable thereafter. Provided this occurs within a week of the journey occurring, it will be accepted that the entry was made as soon as practicable after the end of the journey. 46. It is accepted that the Digital FBT Logbook satisfies the requirements of paragraph (f) of the definition of 'log book records' in subsection 136(1). 47. It is considered that the reports generated by the Digital FBT Logbook are 'a daily log book or similar document' that satisfies the requirement of being made in the English language at, or as soon as reasonably practicable after, the end of the journey. 48. The reports generated by the Digital FBT Logbook satisfy the definition of 'log book records' in subsection 136(1) provided the report is completed for an 'applicable log book period' as defined in subsection 162H(1). Are the logbook records maintained for an 'applicable log book period'? 49. The definition of 'log book records' in subsection 136(1) also requires that each business journey recorded in the logbook records be in relation to a 'period'. Paragraph (a) of section 10A refers to 'log book records' being maintained for an 'applicable log book period'. 50. The term 'applicable log book period' is defined in subsection 162H(1) as follows: 51. It is accepted that in the absence of evidence to the contrary in a particular case, all employers using the Digital FBT Logbook in relation to any car fringe benefits they provide will maintain the necessary records for the duration of the 'applicable log book period' (as the latter term is defined in subsection 162H(1)). 52. Accordingly, it is further considered that odometer and logbook reports that are generated by the Digital FBT Logbook satisfy all of the relevant requirements of the definition of 'log book records' as defined in subsection 136(1). Does the Digital FBT Logbook satisfy the requirements of the definition of 'odometer records' under subsection 136(1)? 53. In order to meet the requirements of section 10A, it is essential that 'odometer records' are maintained in addition to 'log book records'. 54. The term 'odometer records' is defined in subsection 136(1) as: 55. The definition of 'odometer records' in subsection 136(1) requires that odometer readings be recorded both at the 'commencement' and at the 'end' of the periods. 56. Users of the Digital FBT Logbook input the details of the odometer reading. The Digital FBT Logbook also has the ability to read the GPS location from a telematics device to obtain odometer readings. 57. As stated in paragraph 51 of this Ruling, it is accepted that in the absence of evidence to the contrary in a particular case, all employers using the Digital FBT Logbook in relation to any car fringe benefits they provide will maintain the necessary records for the 'applicable log book period'. 58. A report can be generated at the end of the logbook period showing the odometer recordings made and the type of journey undertaken. It is accepted that the Digital FBT Logbook meets the necessary requirement of having entries made in English at, or as soon as reasonably practicable after, the end of the journey. 59. It is considered that the reports generated by the Digital FBT Logbook satisfy all of the relevant requirements of the definition of 'odometer records' as defined in subsection 136(1) for an 'applicable log book period'. Do reports generated by the Digital FBT Logbook provide 'odometer records' for the 'holding period'? 60. Paragraph 10A(b) requires odometer records to be maintained for the 'holding period' as defined in section 162C. 61. Section 162C states: 62. Subsection 162(1) states, among other things, that a car will be held by a person if that person either owns or leases the car. Therefore, the continuous period during a FBT year (including the whole year of tax, where applicable) where an employer either owns or leases a car will be the 'holding period' of that car. 63. Consequently, the odometer readings at the beginning and end of the period during the FBT year (including the whole year of tax, where applicable) where an employer either owns or leases a car will have to be determined. If the Digital FBT Logbook is used continuously for the whole period that a car is held during a FBT year, the Digital FBT Logbook will provide odometer readings for both the beginning and end of that holding period. 64. However, if the Digital FBT Logbook is not used continuously for the whole of the holding period of the car during the FBT year, the employer will need to separately maintain the odometer readings for the holding period. Does the Digital FBT Logbook enable employers to estimate the number of business kilometres travelled during the holding period in a logbook year of tax? 65. Paragraph 10A(d) requires the employer to estimate the number of business kilometres travelled by the car during the holding period. This estimate is used to calculate the business use percentage required by paragraph 10A(e). 66. The basis used to estimate the number of business kilometres is set out in section 162F which states: 67. The Digital FBT Logbook automatically calculates the business kilometres and business use percentage where it is used continuously for the whole of the period of the year for which the car is held. Therefore, where the Digital FBT Logbook is used continuously for the whole of the period of the year for which the car is held, the reports generated will enable the employer to estimate the number of business kilometres travelled during the holding period. 68. However, where the Digital FBT Logbook is not continuously used for the whole of the holding period, the employer, in estimating the number of business kilometres travelled during the holding period, will need to take all relevant matters into account, including any other logbook records and odometer records maintained by or on behalf of the user or driver, and any variations in the pattern of use of the car. Does the Digital FBT Logbook enable employers to specify the business use percentage during the holding period in a logbook year of tax? 69. Paragraph 10A(e) requires the employer to specify a percentage as the 'business use percentage' applicable to the car for the holding period in a logbook year of tax. 70. Subsection 136(1) defines 'business use percentage' to mean the percentage worked out using the formula: business use percentage = Number of business kilometres travelled by the car during the holding period ÷ Total number of kilometres travelled by the car during the holding period × 100 71. Where the Digital FBT Logbook is used continuously for the whole of the holding period, the Digital FBT Logbook Report will calculate the business use percentage for the period using the number of business kilometres and the odometer readings for the beginning and end of the holding period. 72. However, where the Digital FBT Logbook is not continuously used for the whole of the period of the year for which the car is held, the system will not record the number of business kilometres travelled during the holding period, nor the total number of kilometres travelled during the holding period. Therefore, in such a situation, it will be necessary for the employer to separately determine the business use percentage using the estimated number of business kilometres and the odometer readings for the beginning and end of the holding period. Conclusion  Does the Digital FBT Logbook meet the relevant requirements of section 10A? 73. Where the Digital FBT Logbook is used continuously for the whole of the period of the year for which the car is held, the reports generated by the system for that period will meet all the necessary requirements of section 10A. 74. Where the Digital FBT Logbook is not used continuously for the whole of the period of the year for which the car is held, the reports generated by the system will not by itself satisfy the requirements of section 10A. Section 10A is only satisfied if all of the requirements as captured in paragraph 31 of this Ruling are met. Does the Digital FBT Logbook meet the relevant requirements of section 10B? 75. Section 10B states: 76. The definitions of the terms 'odometer records', 'holding period' and 'business use percentage' are as defined in paragraphs 54, 60 and 70 of this Ruling respectively. 77. Where the Digital FBT Logbook is used continuously for the whole of the holding period, the generated reports will meet all the necessary requirements of section 10B in a non-logbook year of tax as long as they: 78. An employer in a non-logbook year of tax who does not use the Digital FBT Logbook in that year of tax, or does not use it for the whole of that period that the car is held but has used the system in one of the previous 4 FBT years continuously for an 'applicable log book period', will not by itself satisfy the requirements of section 10B. The employer will need to: © AUSTRALIAN TAXATION OFFICE FOR THE COMMONWEALTH OF AUSTRALIA You are free to copy, adapt, modify, transmit and distribute this material as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products).

Class of entities or scheme: 12. The following description of the scheme is based on information provided by the applicant. If the scheme is not carried out as described, this Ruling cannot be relied upon. 13. Interleasing provides asset finance, vehicle sourcing and fleet management services to its fleet customers. These services are supported by a technology portal known as Interleasing Connect. 14. Within Interleasing Connect is a system called Driver Manager, which hosts a range of online tools. 15. One such online tool is the Digital FBT Logbook. The Digital FBT Logbook is a cloud-based web application developed to replace traditional manual logbooks. 16. Drivers can access the cloud-based web enabled application, either on their mobile device or computer allowing them to input odometer readings, classify journey information and record the purpose of each journey. 17. The Digital FBT Logbook includes the option to select whether the trip is a personal or business trip. Where it is a business trip, it prompts the employee to include customised or free-text descriptions of the purpose of the business trip. 18. The Digital FBT Logbook delivers reminders to users to complete the logbook if no entries are made for a customer-defined period and sends alerts reminding drivers to complete the Digital FBT Logbook. It also automatically calculates business kilometres and business use percentage over the logbook period. 19. Drivers are required to classify their trips as soon as reasonably practicable after each journey. 20. Drivers can access the Digital FBT Logbook by logging into Driver Manager which has secure login protocols. Additionally, the logbook can be integrated with an optional telematics device to capture trip data in real time. 21. The Interleasing Digital FBT Logbook records the start and end dates and times of each journey in one of 2 ways: 22. The Digital FBT Logbook may be used with a device other than the car's odometer fitting by the car's manufacturer, such as a device with global positioning system (GPS) capability. 23. All journey information is collected and reported in English, and reports can be exported in multiple formats for data analysis and record keeping, including Excel, comma-separated values (CSV), hypertext markup language (HTML), and portable document format (PDF). 24. The Interleasing Digital FBT Logbook Report provides details of the following: 25. The reporting can be provided for any period up to the whole of the 'holding period'. 26. The Digital FBT Logbook stores all historic logbook data. The data is only offloaded from the system should a fleet employer cease using Interleasing's services, and request that Interleasing remove all stored data from their system. 27. Only authorised Interleasing staff have access to the Interleasing Connect systems and reporting processes. Interleasing staff are employed under strict probity-checking conditions and authorised staff are provided with a secure multi-factor authenticated login process. Commissioner of Taxation 17 September 2025

Ruling: 1. This Ruling sets out the fringe benefits tax (FBT) consequences for those employers that enter into an arrangement with Interleasing (Australia) Limited (Interleasing) to utilise the Digital FBT Logbook within the Interleasing software suite, for car logbook and odometer recording purposes. 2. Details of this scheme are set out in paragraphs 12 to 27 of this Ruling. 3. All legislative references in this Ruling are to the Fringe Benefits Tax Assessment Act 1986 (FBTAA). Note: by issuing this Ruling, the ATO is not endorsing this product. Potential purchasers or users must form their own view about the product. | Who this Ruling applies to: 4. This Ruling applies to you if you are an employer who enters an arrangement with Interleasing to utilise the Digital FBT Logbook for FBT recording purposes within Interleasing's software suite. | When this Ruling applies: 5. This Ruling applies from 1 April 2025 to 31 March 2029. | Logbook record: 6. The reports generated by the Digital FBT Logbook through the Driver Manager system satisfy the definition of 'log book records' for the purposes of subsection 136(1) provided: | Odometer records: 7. The reports generated by the Digital FBT Logbook through the Driver Manager system satisfy the definition of 'odometer records' in subsection 136(1). | Requirements of section 10A in a logbook year of tax: 8. An employer in a logbook year of tax will satisfy the requirements of section 10A and is entitled to claim a reduction of operating costs if they use the reports generated by the Digital FBT Logbook through the Driver Manager system continuously for the: 9. An employer in a logbook year of tax who uses the Digital FBT Logbook continuously for the duration of the 'applicable log book period' as that term is defined in subsection 162H(1), but does not use the Digital FBT Logbook continuously for the whole of the 'holding period' as defined in section 162C, satisfies the requirements of section 10A and is entitled to claim a reduction of operating costs provided the employer: | Requirements of section 10B in a non-logbook year of tax: 10. An employer in a non-logbook year of tax that uses the Digital FBT Logbook continuously for the whole of the holding period (as defined in section 162C) satisfies the requirements of section 10B and is entitled to claim a reduction of operating costs. 11. An employer in a non-logbook year of tax who has used the Digital FBT Logbook in one of the previous 4 FBT years continuously for an 'applicable logbook period', but does not use it in that year of tax or for the whole of the period that the car is held, satisfies the requirements of section 10B. They will be entitled to claim a reduction of operating costs of the car on account of business journeys undertaken in the car during the holding period, provided the employer: 12. The following description of the scheme is based on information provided by the applicant. If the scheme is not carried out as described, this Ruling cannot be relied upon. 13. Interleasing provides asset finance, vehicle sourcing and fleet management services to its fleet customers. These services are supported by a technology portal known as Interleasing Connect. 14. Within Interleasing Connect is a system called Driver Manager, which hosts a range of online tools. 15. One such online tool is the Digital FBT Logbook. The Digital FBT Logbook is a cloud-based web application developed to replace traditional manual logbooks. 16. Drivers can access the cloud-based web enabled application, either on their mobile device or computer allowing them to input odometer readings, classify journey information and record the purpose of each journey. 17. The Digital FBT Logbook includes the option to select whether the trip is a personal or business trip. Where it is a business trip, it prompts the employee to include customised or free-text descriptions of the purpose of the business trip. 18. The Digital FBT Logbook delivers reminders to users to complete the logbook if no entries are made for a customer-defined period and sends alerts reminding drivers to complete the Digital FBT Logbook. It also automatically calculates business kilometres and business use percentage over the logbook period. 19. Drivers are required to classify their trips as soon as reasonably practicable after each journey. 20. Drivers can access the Digital FBT Logbook by logging into Driver Manager which has secure login protocols. Additionally, the logbook can be integrated with an optional telematics device to capture trip data in real time. 21. The Interleasing Digital FBT Logbook records the start and end dates and times of each journey in one of 2 ways: 22. The Digital FBT Logbook may be used with a device other than the car's odometer fitting by the car's manufacturer, such as a device with global positioning system (GPS) capability. 23. All journey information is collected and reported in English, and reports can be exported in multiple formats for data analysis and record keeping, including Excel, comma-separated values (CSV), hypertext markup language (HTML), and portable document format (PDF). 24. The Interleasing Digital FBT Logbook Report provides details of the following: 25. The reporting can be provided for any period up to the whole of the 'holding period'. 26. The Digital FBT Logbook stores all historic logbook data. The data is only offloaded from the system should a fleet employer cease using Interleasing's services, and request that Interleasing remove all stored data from their system. 27. Only authorised Interleasing staff have access to the Interleasing Connect systems and reporting processes. Interleasing staff are employed under strict probity-checking conditions and authorised staff are provided with a secure multi-factor authenticated login process. Commissioner of Taxation 17 September 2025 | What is the operating cost method under section 10?: 28. Section 10 allows employers to elect to calculate the taxable value of a car fringe benefit using the cost basis method (operating cost method). 29. Where the election is made, the taxable value of a car fringe benefit using the operating cost method is calculated according to the following formular in subsection 10(2): (C × (100% − BP)) − R 30. Therefore, an employer intending to claim a reduction in the operating cost of a car, on account of business journeys undertaken during the holding period, must meet the requirements of either section 10A (if the year is a 'log book year of tax' (as defined in paragraph 32 of this Ruling)) or section 10B (if the year is not a 'log book year of tax'), as applicable. | Does the Digital FBT Logbook meet the relevant requirements of section 10A?: 31. Section 10A states: 32. Section 162G sets out various circumstances under which a particular year can be treated as a 'log book year of tax'. It is accepted that all employers using the Digital FBT Logbook will make an election under paragraph 162G(1)(b) to treat the relevant current year of tax as a 'log book year of tax'. | Does the Digital FBT Logbook satisfy the requirements of the definition of 'log book records' under subsection 136(1)?: 33. Subsection 136(1) defines 'log book records' as: 34. A logbook record is essentially a daily logbook or similar document which contains an entry for each business journey made in the car during the period (paragraph (a) of the definition of 'log book records' in subsection 136(1)) that the holder of the car chooses to record in the document for the purposes of demonstrating the pattern of use of the car during the relevant period (paragraph (b) of the definition of 'log book records' in subsection 136(1)). 35. Paragraph (c) of the definition of 'log book records' in subsection 136(1) requires the date on which the journey began and ended to be entered in the relevant records. The Digital FBT Logbook records the start and end dates and times of each journey, and this information is detailed in the reports it generates. Therefore, this requirement is satisfied. 36. Paragraph (d) of the definition of 'log book records' in subsection 136(1) requires the respective odometer readings of the car at the beginning and at the end of the journey be entered into the relevant records. 37. The term 'odometer' is not defined in either the FBTAA or the Income Tax Assessment Act 1997, but the Macquarie Dictionary defines that term as being, 'an instrument for measuring distance passed over, as by a motor vehicle'. [1] 38. The term 'odometer records', as defined in subsection 136(1), makes reference to 'odometer reading of the car'. While odometer readings must pertain to the car, it does not necessarily mean that they must also be attributable either wholly or in part to the rotation of the car's wheels, thereby mechanically moving the standard odometer fitted in the car by the manufacturer. 39. Provided the GPS device used to determine the car's odometer readings is of sufficient integrity, it is accepted that a system other than the car's own odometer may meet the legislative requirements of the FBTAA. 40. Each time the car is driven, the start and end odometer readings for the journey are calculated from a telematics device with GPS capability. It is accepted that the opening and closing odometer readings calculated by the Digital FBT Logbook is of sufficient integrity to be odometer readings of the car. 41. It is accepted that the opening and closing odometer readings for each car journey detailed in the Digital FBT Log book Report satisfies the requirements of paragraph (d) of the definition of 'log book records' in subsection 136(1). 42. The number of kilometres travelled by the car in the course of each journey is also detailed by the Digital FBT Logbook Report thus satisfying the requirement of paragraph (e) of the definition of 'log book records' in subsection 136(1). 43. Paragraph (f) of the definition of 'log book records' in subsection 136(1) requires the purpose or purposes of the business journeys to be recorded. Further, the definition of 'log book records' requires that entries be made at, or as soon as reasonably practicable after, the end of the journey. 44. The classification of a journey as being for business use or private use is input by the driver by logging into the cloud-based application via their mobile device or their computer at the end of each car journey. For business journeys, the driver must also enter the purpose of the trip. 45. It is expected that the purpose recorded for each business journey is sufficiently descriptive to enable the journey to be classified as a business journey and that the relevant classification and description will be made at the end of each journey or as soon as reasonably practicable thereafter. Provided this occurs within a week of the journey occurring, it will be accepted that the entry was made as soon as practicable after the end of the journey. 46. It is accepted that the Digital FBT Logbook satisfies the requirements of paragraph (f) of the definition of 'log book records' in subsection 136(1). 47. It is considered that the reports generated by the Digital FBT Logbook are 'a daily log book or similar document' that satisfies the requirement of being made in the English language at, or as soon as reasonably practicable after, the end of the journey. 48. The reports generated by the Digital FBT Logbook satisfy the definition of 'log book records' in subsection 136(1) provided the report is completed for an 'applicable log book period' as defined in subsection 162H(1). | Are the logbook records maintained for an 'applicable log book period'?: 49. The definition of 'log book records' in subsection 136(1) also requires that each business journey recorded in the logbook records be in relation to a 'period'. Paragraph (a) of section 10A refers to 'log book records' being maintained for an 'applicable log book period'. 50. The term 'applicable log book period' is defined in subsection 162H(1) as follows: 51. It is accepted that in the absence of evidence to the contrary in a particular case, all employers using the Digital FBT Logbook in relation to any car fringe benefits they provide will maintain the necessary records for the duration of the 'applicable log book period' (as the latter term is defined in subsection 162H(1)). 52. Accordingly, it is further considered that odometer and logbook reports that are generated by the Digital FBT Logbook satisfy all of the relevant requirements of the definition of 'log book records' as defined in subsection 136(1). | Does the Digital FBT Logbook satisfy the requirements of the definition of 'odometer records' under subsection 136(1)?: 53. In order to meet the requirements of section 10A, it is essential that 'odometer records' are maintained in addition to 'log book records'. 54. The term 'odometer records' is defined in subsection 136(1) as: 55. The definition of 'odometer records' in subsection 136(1) requires that odometer readings be recorded both at the 'commencement' and at the 'end' of the periods. 56. Users of the Digital FBT Logbook input the details of the odometer reading. The Digital FBT Logbook also has the ability to read the GPS location from a telematics device to obtain odometer readings. 57. As stated in paragraph 51 of this Ruling, it is accepted that in the absence of evidence to the contrary in a particular case, all employers using the Digital FBT Logbook in relation to any car fringe benefits they provide will maintain the necessary records for the 'applicable log book period'. 58. A report can be generated at the end of the logbook period showing the odometer recordings made and the type of journey undertaken. It is accepted that the Digital FBT Logbook meets the necessary requirement of having entries made in English at, or as soon as reasonably practicable after, the end of the journey. 59. It is considered that the reports generated by the Digital FBT Logbook satisfy all of the relevant requirements of the definition of 'odometer records' as defined in subsection 136(1) for an 'applicable log book period'. | Do reports generated by the Digital FBT Logbook provide 'odometer records' for the 'holding period'?: 60. Paragraph 10A(b) requires odometer records to be maintained for the 'holding period' as defined in section 162C. 61. Section 162C states: 62. Subsection 162(1) states, among other things, that a car will be held by a person if that person either owns or leases the car. Therefore, the continuous period during a FBT year (including the whole year of tax, where applicable) where an employer either owns or leases a car will be the 'holding period' of that car. 63. Consequently, the odometer readings at the beginning and end of the period during the FBT year (including the whole year of tax, where applicable) where an employer either owns or leases a car will have to be determined. If the Digital FBT Logbook is used continuously for the whole period that a car is held during a FBT year, the Digital FBT Logbook will provide odometer readings for both the beginning and end of that holding period. 64. However, if the Digital FBT Logbook is not used continuously for the whole of the holding period of the car during the FBT year, the employer will need to separately maintain the odometer readings for the holding period. | Does the Digital FBT Logbook enable employers to estimate the number of business kilometres travelled during the holding period in a logbook year of tax?: 65. Paragraph 10A(d) requires the employer to estimate the number of business kilometres travelled by the car during the holding period. This estimate is used to calculate the business use percentage required by paragraph 10A(e). 66. The basis used to estimate the number of business kilometres is set out in section 162F which states: 67. The Digital FBT Logbook automatically calculates the business kilometres and business use percentage where it is used continuously for the whole of the period of the year for which the car is held. Therefore, where the Digital FBT Logbook is used continuously for the whole of the period of the year for which the car is held, the reports generated will enable the employer to estimate the number of business kilometres travelled during the holding period. 68. However, where the Digital FBT Logbook is not continuously used for the whole of the holding period, the employer, in estimating the number of business kilometres travelled during the holding period, will need to take all relevant matters into account, including any other logbook records and odometer records maintained by or on behalf of the user or driver, and any variations in the pattern of use of the car. | Does the Digital FBT Logbook enable employers to specify the business use percentage during the holding period in a logbook year of tax?: 69. Paragraph 10A(e) requires the employer to specify a percentage as the 'business use percentage' applicable to the car for the holding period in a logbook year of tax. 70. Subsection 136(1) defines 'business use percentage' to mean the percentage worked out using the formula: business use percentage = Number of business kilometres travelled by the car during the holding period ÷ Total number of kilometres travelled by the car during the holding period × 100 71. Where the Digital FBT Logbook is used continuously for the whole of the holding period, the Digital FBT Logbook Report will calculate the business use percentage for the period using the number of business kilometres and the odometer readings for the beginning and end of the holding period. 72. However, where the Digital FBT Logbook is not continuously used for the whole of the period of the year for which the car is held, the system will not record the number of business kilometres travelled during the holding period, nor the total number of kilometres travelled during the holding period. Therefore, in such a situation, it will be necessary for the employer to separately determine the business use percentage using the estimated number of business kilometres and the odometer readings for the beginning and end of the holding period. | Conclusion  Does the Digital FBT Logbook meet the relevant requirements of section 10A?: 73. Where the Digital FBT Logbook is used continuously for the whole of the period of the year for which the car is held, the reports generated by the system for that period will meet all the necessary requirements of section 10A. 74. Where the Digital FBT Logbook is not used continuously for the whole of the period of the year for which the car is held, the reports generated by the system will not by itself satisfy the requirements of section 10A. Section 10A is only satisfied if all of the requirements as captured in paragraph 31 of this Ruling are met. | Does the Digital FBT Logbook meet the relevant requirements of section 10B?: 75. Section 10B states: 76. The definitions of the terms 'odometer records', 'holding period' and 'business use percentage' are as defined in paragraphs 54, 60 and 70 of this Ruling respectively. 77. Where the Digital FBT Logbook is used continuously for the whole of the holding period, the generated reports will meet all the necessary requirements of section 10B in a non-logbook year of tax as long as they: 78. An employer in a non-logbook year of tax who does not use the Digital FBT Logbook in that year of tax, or does not use it for the whole of that period that the car is held but has used the system in one of the previous 4 FBT years continuously for an 'applicable log book period', will not by itself satisfy the requirements of section 10B. The employer will need to: © AUSTRALIAN TAXATION OFFICE FOR THE COMMONWEALTH OF AUSTRALIA You are free to copy, adapt, modify, transmit and distribute this material as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products).


Appendix: What is the operating cost method under section 10?: 28. Section 10 allows employers to elect to calculate the taxable value of a car fringe benefit using the cost basis method (operating cost method). 29. Where the election is made, the taxable value of a car fringe benefit using the operating cost method is calculated according to the following formular in subsection 10(2): (C × (100% − BP)) − R 30. Therefore, an employer intending to claim a reduction in the operating cost of a car, on account of business journeys undertaken during the holding period, must meet the requirements of either section 10A (if the year is a 'log book year of tax' (as defined in paragraph 32 of this Ruling)) or section 10B (if the year is not a 'log book year of tax'), as applicable. | Does the Digital FBT Logbook meet the relevant requirements of section 10A?: 31. Section 10A states: 32. Section 162G sets out various circumstances under which a particular year can be treated as a 'log book year of tax'. It is accepted that all employers using the Digital FBT Logbook will make an election under paragraph 162G(1)(b) to treat the relevant current year of tax as a 'log book year of tax'. | Does the Digital FBT Logbook satisfy the requirements of the definition of 'log book records' under subsection 136(1)?: 33. Subsection 136(1) defines 'log book records' as: 34. A logbook record is essentially a daily logbook or similar document which contains an entry for each business journey made in the car during the period (paragraph (a) of the definition of 'log book records' in subsection 136(1)) that the holder of the car chooses to record in the document for the purposes of demonstrating the pattern of use of the car during the relevant period (paragraph (b) of the definition of 'log book records' in subsection 136(1)). 35. Paragraph (c) of the definition of 'log book records' in subsection 136(1) requires the date on which the journey began and ended to be entered in the relevant records. The Digital FBT Logbook records the start and end dates and times of each journey, and this information is detailed in the reports it generates. Therefore, this requirement is satisfied. 36. Paragraph (d) of the definition of 'log book records' in subsection 136(1) requires the respective odometer readings of the car at the beginning and at the end of the journey be entered into the relevant records. 37. The term 'odometer' is not defined in either the FBTAA or the Income Tax Assessment Act 1997, but the Macquarie Dictionary defines that term as being, 'an instrument for measuring distance passed over, as by a motor vehicle'. [1] 38. The term 'odometer records', as defined in subsection 136(1), makes reference to 'odometer reading of the car'. While odometer readings must pertain to the car, it does not necessarily mean that they must also be attributable either wholly or in part to the rotation of the car's wheels, thereby mechanically moving the standard odometer fitted in the car by the manufacturer. 39. Provided the GPS device used to determine the car's odometer readings is of sufficient integrity, it is accepted that a system other than the car's own odometer may meet the legislative requirements of the FBTAA. 40. Each time the car is driven, the start and end odometer readings for the journey are calculated from a telematics device with GPS capability. It is accepted that the opening and closing odometer readings calculated by the Digital FBT Logbook is of sufficient integrity to be odometer readings of the car. 41. It is accepted that the opening and closing odometer readings for each car journey detailed in the Digital FBT Log book Report satisfies the requirements of paragraph (d) of the definition of 'log book records' in subsection 136(1). 42. The number of kilometres travelled by the car in the course of each journey is also detailed by the Digital FBT Logbook Report thus satisfying the requirement of paragraph (e) of the definition of 'log book records' in subsection 136(1). 43. Paragraph (f) of the definition of 'log book records' in subsection 136(1) requires the purpose or purposes of the business journeys to be recorded. Further, the definition of 'log book records' requires that entries be made at, or as soon as reasonably practicable after, the end of the journey. 44. The classification of a journey as being for business use or private use is input by the driver by logging into the cloud-based application via their mobile device or their computer at the end of each car journey. For business journeys, the driver must also enter the purpose of the trip. 45. It is expected that the purpose recorded for each business journey is sufficiently descriptive to enable the journey to be classified as a business journey and that the relevant classification and description will be made at the end of each journey or as soon as reasonably practicable thereafter. Provided this occurs within a week of the journey occurring, it will be accepted that the entry was made as soon as practicable after the end of the journey. 46. It is accepted that the Digital FBT Logbook satisfies the requirements of paragraph (f) of the definition of 'log book records' in subsection 136(1). 47. It is considered that the reports generated by the Digital FBT Logbook are 'a daily log book or similar document' that satisfies the requirement of being made in the English language at, or as soon as reasonably practicable after, the end of the journey. 48. The reports generated by the Digital FBT Logbook satisfy the definition of 'log book records' in subsection 136(1) provided the report is completed for an 'applicable log book period' as defined in subsection 162H(1). | Are the logbook records maintained for an 'applicable log book period'?: 49. The definition of 'log book records' in subsection 136(1) also requires that each business journey recorded in the logbook records be in relation to a 'period'. Paragraph (a) of section 10A refers to 'log book records' being maintained for an 'applicable log book period'. 50. The term 'applicable log book period' is defined in subsection 162H(1) as follows: 51. It is accepted that in the absence of evidence to the contrary in a particular case, all employers using the Digital FBT Logbook in relation to any car fringe benefits they provide will maintain the necessary records for the duration of the 'applicable log book period' (as the latter term is defined in subsection 162H(1)). 52. Accordingly, it is further considered that odometer and logbook reports that are generated by the Digital FBT Logbook satisfy all of the relevant requirements of the definition of 'log book records' as defined in subsection 136(1). | Does the Digital FBT Logbook satisfy the requirements of the definition of 'odometer records' under subsection 136(1)?: 53. In order to meet the requirements of section 10A, it is essential that 'odometer records' are maintained in addition to 'log book records'. 54. The term 'odometer records' is defined in subsection 136(1) as: 55. The definition of 'odometer records' in subsection 136(1) requires that odometer readings be recorded both at the 'commencement' and at the 'end' of the periods. 56. Users of the Digital FBT Logbook input the details of the odometer reading. The Digital FBT Logbook also has the ability to read the GPS location from a telematics device to obtain odometer readings. 57. As stated in paragraph 51 of this Ruling, it is accepted that in the absence of evidence to the contrary in a particular case, all employers using the Digital FBT Logbook in relation to any car fringe benefits they provide will maintain the necessary records for the 'applicable log book period'. 58. A report can be generated at the end of the logbook period showing the odometer recordings made and the type of journey undertaken. It is accepted that the Digital FBT Logbook meets the necessary requirement of having entries made in English at, or as soon as reasonably practicable after, the end of the journey. 59. It is considered that the reports generated by the Digital FBT Logbook satisfy all of the relevant requirements of the definition of 'odometer records' as defined in subsection 136(1) for an 'applicable log book period'. | Do reports generated by the Digital FBT Logbook provide 'odometer records' for the 'holding period'?: 60. Paragraph 10A(b) requires odometer records to be maintained for the 'holding period' as defined in section 162C. 61. Section 162C states: 62. Subsection 162(1) states, among other things, that a car will be held by a person if that person either owns or leases the car. Therefore, the continuous period during a FBT year (including the whole year of tax, where applicable) where an employer either owns or leases a car will be the 'holding period' of that car. 63. Consequently, the odometer readings at the beginning and end of the period during the FBT year (including the whole year of tax, where applicable) where an employer either owns or leases a car will have to be determined. If the Digital FBT Logbook is used continuously for the whole period that a car is held during a FBT year, the Digital FBT Logbook will provide odometer readings for both the beginning and end of that holding period. 64. However, if the Digital FBT Logbook is not used continuously for the whole of the holding period of the car during the FBT year, the employer will need to separately maintain the odometer readings for the holding period. | Does the Digital FBT Logbook enable employers to estimate the number of business kilometres travelled during the holding period in a logbook year of tax?: 65. Paragraph 10A(d) requires the employer to estimate the number of business kilometres travelled by the car during the holding period. This estimate is used to calculate the business use percentage required by paragraph 10A(e). 66. The basis used to estimate the number of business kilometres is set out in section 162F which states: 67. The Digital FBT Logbook automatically calculates the business kilometres and business use percentage where it is used continuously for the whole of the period of the year for which the car is held. Therefore, where the Digital FBT Logbook is used continuously for the whole of the period of the year for which the car is held, the reports generated will enable the employer to estimate the number of business kilometres travelled during the holding period. 68. However, where the Digital FBT Logbook is not continuously used for the whole of the holding period, the employer, in estimating the number of business kilometres travelled during the holding period, will need to take all relevant matters into account, including any other logbook records and odometer records maintained by or on behalf of the user or driver, and any variations in the pattern of use of the car. | Does the Digital FBT Logbook enable employers to specify the business use percentage during the holding period in a logbook year of tax?: 69. Paragraph 10A(e) requires the employer to specify a percentage as the 'business use percentage' applicable to the car for the holding period in a logbook year of tax. 70. Subsection 136(1) defines 'business use percentage' to mean the percentage worked out using the formula: business use percentage = Number of business kilometres travelled by the car during the holding period ÷ Total number of kilometres travelled by the car during the holding period × 100 71. Where the Digital FBT Logbook is used continuously for the whole of the holding period, the Digital FBT Logbook Report will calculate the business use percentage for the period using the number of business kilometres and the odometer readings for the beginning and end of the holding period. 72. However, where the Digital FBT Logbook is not continuously used for the whole of the period of the year for which the car is held, the system will not record the number of business kilometres travelled during the holding period, nor the total number of kilometres travelled during the holding period. Therefore, in such a situation, it will be necessary for the employer to separately determine the business use percentage using the estimated number of business kilometres and the odometer readings for the beginning and end of the holding period. | Conclusion  Does the Digital FBT Logbook meet the relevant requirements of section 10A?: 73. Where the Digital FBT Logbook is used continuously for the whole of the period of the year for which the car is held, the reports generated by the system for that period will meet all the necessary requirements of section 10A. 74. Where the Digital FBT Logbook is not used continuously for the whole of the period of the year for which the car is held, the reports generated by the system will not by itself satisfy the requirements of section 10A. Section 10A is only satisfied if all of the requirements as captured in paragraph 31 of this Ruling are met. | Does the Digital FBT Logbook meet the relevant requirements of section 10B?: 75. Section 10B states: 76. The definitions of the terms 'odometer records', 'holding period' and 'business use percentage' are as defined in paragraphs 54, 60 and 70 of this Ruling respectively. 77. Where the Digital FBT Logbook is used continuously for the whole of the holding period, the generated reports will meet all the necessary requirements of section 10B in a non-logbook year of tax as long as they: 78. An employer in a non-logbook year of tax who does not use the Digital FBT Logbook in that year of tax, or does not use it for the whole of that period that the car is held but has used the system in one of the previous 4 FBT years continuously for an 'applicable log book period', will not by itself satisfy the requirements of section 10B. The employer will need to: © AUSTRALIAN TAXATION OFFICE FOR THE COMMONWEALTH OF AUSTRALIA You are free to copy, adapt, modify, transmit and distribute this material as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products).


What this Ruling is about | If this Ruling applies to you, and you correctly rely on it, we will apply the law to you in the way set out in this Ruling. That is, you will not pay any more tax or penalties or interest in respect of the matters covered by this Ruling. | C is the operating cost of the car during the holding period; | R is the amount (if any) of the recipient's payment. | is made in the English language at, or as soon as reasonably practicable after, the end of the journey. | are entered in the English language, at, or as soon as reasonably practicable after, the respective times to which those odometer readings relate.


Legislative references: FBTAA 10 FBTAA 10(2) FBTAA 10A FBTAA 10A(b) FBTAA 10A(d) FBTAA 10A(e) FBTAA 10B FBTAA 136(1) FBTAA 162(1) FBTAA 162C FBTAA 162F FBTAA 162G FBTAA 162G(1) FBTAA 162G(1)(a) FBTAA 162G(1)(b) FBTAA 162H(1)
Other references: Pan Macmillan Australia (2025) The Macquarie Dictionary online, http://www.macquariedictionary.com.au