# Worked Example — Bounty #05

**Companion file to:** `01-brief.md`

## The scenario

**Employer:** JKL Consulting Pty Ltd
**FBT year:** 1 April 2024 to 31 March 2025 (FY2025 FBT year)
**Employee:** Sarah, senior consultant
**Car:** 2024 Toyota Kluger, purchased new by employer 1 May 2024
**Cost:** $65,000 (GST-inclusive; delivered price including on-roads)
**Days available for private use:** 335 (from 1 May 2024 to 31 March 2025)
**Employee contribution:** $2,000 (paid by Sarah, after-tax)

**Log book status:** Sarah maintained a valid 12-week log book from 1 May 2024 to 24 July 2024, showing 68% business use.

**Operating costs for the FBT year:**
- Fuel: $4,200
- Servicing and repairs: $1,150
- Registration: $920
- Insurance: $1,650
- Deemed depreciation (s 11): (see calculator)
- Deemed interest (s 11): (see calculator)

## The engine's calculations

**Method A — Statutory formula (s 9):**
- Base value: $65,000
- Statutory rate: 20%
- Days available / days in year: 335 / 365
- Taxable value (pre-contribution): $65,000 × 20% × (335/365) = **$11,930.14**
- Less employee contribution: $2,000
- **Taxable value: $9,930.14**

**Method B — Operating cost (s 10):**
- Total actual operating costs: $4,200 + $1,150 + $920 + $1,650 = $7,920
- Deemed depreciation (s 11(1)(a)): $65,000 × 25% × (335/365) = $14,914.38
- Deemed interest (s 11(1)(b)): $65,000 × 8.77% × (335/365) = $5,229.06 (using FY2025 statutory benchmark 8.77%)
- Total operating costs: $7,920 + $14,914.38 + $5,229.06 = $28,063.44
- Private use %: 100% − 68% = 32%
- Taxable value (pre-contribution): $28,063.44 × 32% × (335/365) = $8,241.16
- Less employee contribution: $2,000
- **Taxable value: $6,241.16**

## The engine's recommendation

Operating cost produces the lower taxable value ($6,241 vs $9,930), so — subject to the taxpayer's own election right — Method B minimises FBT.

## What the reviewer is being asked

1. Are the two calculation formulae correctly stated?
2. Is the days-available count correct (335)?
3. Is the deemed depreciation rate (25%) and deemed interest rate (statutory benchmark 8.77% for FY2025) correctly applied under s 11?
4. Does the log book qualify (12 weeks, 1 May to 24 July = ~12 weeks)?
5. Is the recipient's payment correctly subtracted from the pre-contribution taxable value?
6. Anything the engine is doing wrong or missing?