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Considered Value

Issue 112 - March 2017 Special Edition

 

Fringe Benefits Tax (FBT)

Once again it is that time of year when businesses need to consider if any Fringe Benefits have been provided to employees or their associates. An associate of an employee is their spouse, children, other family members, a related trust or company.

Please find below a questionnaire designed to check if you have provided any of the following fringe benefits during this FBT year (1 April 2016 to 31 March 2017). Please note that this is not an exhaustive list but covers the most common types of fringe benefits provided to employees.

Motor Vehicles

Do you provide motor vehicles that are available for personal use by staff (or their associates)? This includes driving to and from work.

We recommend that all motor vehicles provided (even by way of novated lease) have an odometer reading taken as at 31 March 2017.

Yes

 

 

 

 

No

 

 

 

Car Parking

Did your organisation provide car parking facilities to an employee (or his/her associates) at a commercial parking station?

Did your organisation provide car parking facilities to an employee (or his/her associates) at, or in the vicinity of, your business premises and is the income of your business more the $10 million (GST exclusive)?

If yes, is there a commercial parking station located within 1km of your premises and does the commercial car parking station charge members of the public more than $8.48 for all day parking, and is the car parked on the premises for more than 4 hours between 7am and 7pm?

(Some employers such as charities, public educational institutions, government bodies may be exempt)

Yes

 

 

 

 

No

 

 

 

 

Loans

Did your organisation lend any money to an employee (or his/her associate)?

Is the rate of interest being charged less than 5.65%?

Some examples include advances of money, the provision of credit or the payment of an amount where there is an obligation to repay the amount.

Yes

 

 

  

No

 

 

  

Goods Provided

Did your organisation provide goods to an employee (or his/her associate) for free or less than market value?

Some examples are gift baskets, goods produced by your organisation and gift vouchers. Also laptops, software, or tools of trade if not provided primarily for the employee's employment.

If the items are provided infrequently, irregularly and are valued at less than $300 (GST inclusive), you may be entitled to an exemption.

Yes

 

No


Eligible work related items provided to employees and used by that employee primarily for employment related purposes are exempt from FBT. 

The ATO has previously disallowed this exemption on any further items provided during the FBT year with substantially identical functions to a previously provided exempt item (unless the original item was lost, stolen, destroyed, or outdated due to technological developments). 

This exemption is now being expanded to make further eligible items provided to employees of Small Business Entities (with grouped turnover of less than $2 million per annum) exempt, where the item is a portable electronic device (such as a Laptop), with a substantially identical function to any other item provided during the FBT year.


Entertainment

Do you provide any form of entertainment to an employee (or his/her associate)?

Some examples are:

Business lunches and drinks, staff social functions such as Christmas parties, Friday night drinks, tickets to sporting events and theatre, accommodation and travel in connection with entertaining clients, games of golf or similar leisure activities.

If the entertainment is provided infrequently, irregularly and valued at less than $300 (GST inclusive), you may be entitled to an exemption.

If food or drink is provided to and consumed by a current employee on a working day on the employer's business premises (e.g. Friday night drinks), you may be entitled to an exemption.

Yes

No

 

The following items are not entertainment:

  • Tea, coffee and other such amenities provided on business premises.
  • Light refreshments on business premises such as morning/afternoon teas or meals (not including alcohol) in connection with meetings, training sessions, or overtime work.
  • Food and drink provided during a conference and accommodation for a conference.

$5000 cap for salary packaged entertainment

From the 1st of April 2016, employees of FBT- rebatable and FBT-exempt employers have a new $5,000 cap for salary packaged entertainment benefits on top of the existing capping thresholds. This means from the 1st of April 2016 where an employee exceeds the current cap for exempt benefits, the excess amount will be reduced by the lesser of the amount of salary packaged entertainment benefits provided or $5,000. Note that only salary packaged entertainment benefits can be included in the $5,000 cap.

Furthermore, employers will no longer have access to the 50/50 split and 12-week register method in respect of any salary packaged meal entertainment or the 50/50 split method in respect of any salary packaged entertainment facility leasing expenses.

Other

Did your organisation provide any other type of benefit to an employee (or his/her associate) which has not been disclosed above (e.g. any assets available for private use or services provided)?

Yes

 

No

 

Did your organisation provide accommodation to an employee (or his/her associate)?

Did your organisation pay an allowance to any employee as compensation for living away from home?

Did your organisation pay for any expense (e.g. fuel, subscriptions to clubs, rent on accommodation, private telephone) on behalf of an employee (or his/her associate)?

Did your organisation reimburse an employee (or his/her associate) for any private expenses (eg restaurant meals)?

 

If you answered YES to any of the above, please contact our office so we can assist in determining if you have provided any fringe benefits.

If you are already registered for FBT we will be sending out our customised checklists.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Disclaimer

The information provided in this questionnaire does not constitute advice. The information is of a general nature only and does not take into account your individual circumstances.
We recommend that you contact Brentnalls SA to discuss your particular requirements or circumstances.

Industry Focus

We have a deep understanding of the issues facing small to medium enterprises but we recognise that to be trusted business advisors we also need to understand the industry you work in.

You need to be confident that your advisors are up to speed on the issues and challenges that you face.

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