Fringe benefits tax - exemption for eligible work-related items
On 13 May 2008, the Treasurer announced in the 2008 Budget that the government will tighten the current fringe benefits tax (FBT) exemption for certain work-related items (including laptop computers, personal digital assistants and tools of trade) by ensuring the exemption only applies where these items are used primarily for work purposes.
The FBT exemption will be limited to one item of each type per employee per FBT year (unless it is a replacement item). The measure will apply to items purchased from 7.30pm (AEST) on 13 May 2008.
The measure reduces the FBT concession and tax expenditure for work-related items.
The measure will ensure consistency with the rules applying to mobile phones, computer software, and protective clothing. The current list of FBT exempt work-related items will also be updated to reflect changes in technology by extending the exemption to all work-related portable electronic devices, including those with multiple functions.
Changes will also be made to deny employees depreciation deductions for eligible work-related items that are exempt from FBT. For such items purchased from 7.30pm (AEST) on 13 May 2008, employees will not be able to claim depreciation deductions. For such items purchased before that time, no depreciation deductions will be allowed for the 2008–09 and later income years.
This measure will ensure that employees are no longer able to gain a double benefit by obtaining an FBT exempt item (such as a laptop computer) from their pre-tax income, and then claim a deduction for depreciation.
Press release
For more information, see the Treasurer's press release number048/2008.
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