Fringe Benefit Tax (FBT) is a tax paid by employers who provide certain benefits to employees and their associates. The main type of benefits provided are entertainment (including meals and tickets to events) and providing an employee the use of a car for private use.
The 2022 FBT year ends on 31 March 2022. (Really?) Yes, that date is not an error as the Fringe benefits tax (FBT) year runs from April to March (unlike the Australian tax year which runs from July to June). It can be confusing at times.
FBT is the short for Fringe Benefits Tax. It is a tax imposed on employers who provide certain fringe benefits they provide to their employees, including their employees’ family and associates.
There are a lot of myths around Utes and FBT, some of which may be spreading by “mates” at the bar, or during a smoko. Not all the myths are true, let’s look at some of them here:
No. It is important to note that a vehicle that does not satisfy the definition of a ‘car’ such as a ute is not automatically exempt from FBT.
With Christmas fast approaching, a lot of business owners are starting to think (or already thinking!) about how they are going to celebrate Christmas with their employees and clients.
While it is a festive season where you normally spend a little more in treating your employees, their families and clients with good food, wine and some activities, enjoying the time and having some fun, business owners may unknowingly provide Fringe Benefits where it may end up costing you more.
The following article applies to those who use motor vehicles in the course of running their businesses.
For many years, many entities have enjoyed a FBT exemption where:
These have been a grey area and have caused confusion to business owners when attempting to work out whether their vehicles are exempt or not.
The ATO has recently released new guidelines to reduce confusion and provide more certainty for employers when applying the FBT exemptions. The guidance notes relate to the clarification on the definition of an employee’s (and/or their associate’s) private use where it is ‘minor, infrequent and irregular’ for FBT purposes.
If you believe you fall under this category and would like more clarity, contact us for more information and we can talk you through this over the phone, or via email.
The FBT year has ended 31 March 2018. For those who require a return lodgement, your FBT Return is due by 21 May 2018. Please contact us for instructions on the lodgement of the return.
For those who provide motor vehicle benefits to employees and/or associates, it is important that you keep records of your vehicle’s odometer reading as at 31 March 2018.
