Worker entitlement contributions
Under changes proposed by the Fair Work Laws Amendment (Proper Use of Worker Benefits) Bill 2017, the exemption for worker entitlement contributions will only be available to an employer if the contribution is made to a fund either:
- registered under the Fair Work (Registered Organisations) Act 2009
- established by or under, and operating under, a law of the Commonwealth, a state or territory, for the purposes of ensuring long service leave is paid.
Other existing conditions for exemption are unaltered by this measure.
The proposed changes will apply from a date set by proclamation or six months and a day after the changes receive Royal Assent. Employers will need to confirm that any worker entitlement fund they make a contribution to is registered at the time of commencement, under either:
- the Fair Work (Registered Organisations) Act 2009
- the register maintained by the Registered Organisations Commissioner as a transitioning fund.
Funds currently endorsed as an ‘approved worker entitlement fund’ for fringe benefits tax may be ‘transitioning funds’ for up to six months while they seek registration as a worker entitlement fund.
At the time of publishing, this change had not yet become law.
Worker entitlement funds
There will be changes for funds that are currently endorsed, or seeking endorsement, as a worker entitlement fund for FBT purposes should the proposed amendments become law. They will be required to register under the Fair Work (Registered Organisations) Act 2009 if they wish to continue to operate as a worker entitlement fund. Registration will involve considerations and obligations unrelated to FBT.
Salary or wages paid in cryptocurrency
If an employee receives cryptocurrency as remuneration instead of Australian dollars, the payment of the cryptocurrency may be a fringe benefit.
See also:
- Tax treatment of cryptocurrencies
- Taxation Determination TD 2014/28 – Fringe benefits tax: is the provision of bitcoin by an employer to an employee in respect of their employment a property fringe benefit for the purposes of subsection 136(1) of the Fringe Benefits Tax Assessment Act 1986?
- Taxation Ruling TR 2001/10 – Income tax: fringe benefits tax and superannuation guarantee: salary sacrifice arrangements
Exempt car and residual benefits – determining private use
We have released Practical Compliance Guideline PCG 2018/3 about our compliance approach to determining if the private use of eligible vehicles by your employees meets the FBT car-related exemptions.
There are examples in the guideline to help you understand how it may apply to benefits you provide in the 2019 FBT year and later years. Even if you don't meet the requirements of the PCG, you can still rely on the FBT law to determine if you can access the FBT exemptions.
See also:
- Practical Compliance Guideline PCG 2018/3 – Exempt car benefits and exempt residual benefits: compliance approach to determining private use of vehicles.
Next steps: