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Worked examples – not-for-profit employers – completing your FBT return

Last updated 25 March 2019

The following worked example shows how to complete a:

Rebatable employer return

You provide the following benefits for the year ending 31 March 2019 to your employees:

  • pay Mark, Sam and eight other employees' children’s school fees (an expense payment fringe benefit)
  • provide Mark and Sam with cars for private use (a car fringe benefit)
  • allow Mark and Sam to purchase restaurant meals on a credit card that is paid by the employer at the end of the month, under a salary packaging arrangement.

The car fringe benefits are type 1 benefits because they are GST taxable supplies with an entitlement to a GST credit.

Mark's car fringe benefit calculated using the statutory formula method (GST taxable supply with an entitlement to a GST credit) is $14,000.

Sam's car fringe benefit calculated using the statutory formula method (GST taxable supply with an entitlement to a GST credit) is $15,000.

Total car fringe benefits = $29,000

Type 1 aggregate amount, which is shown at item 14A on the return is:

  • $29,000 × 2.0802 = $60,325.80

The school fees are type 2 benefits because they are GST-free supplies with no GST credit entitlement.

Multiply the expense payment fringe benefits by the number of employees receiving the payment.

$6,000 (expense payment fringe benefit × 10 (number of employees)) = $60,000

Type 2 aggregate amount, which is shown at item 14B on the return, is:

  • $60,000 × 1.8868 = $113,208.00

The use of the meal card is a type 2 benefit because it is an input taxed financial supply with no entitlement to a GST credit.

Mark's meal entertainment fringe benefit is $5,500 (ie the amount Mark charged to the credit card for meals).

Sam's meal entertainment fringe benefit is $2,295.

Total meal entertainment fringe benefit = $7,795

Type 2 aggregate amount is:

  • $7,795 × 1.8868 = $14,707.60

The total type 2 aggregate amount is therefore:

  • $113,208.00 + $14,707.60 = $127,915.60.

You have:

  • a fringe benefits taxable amount of $188,240 ($60,325 + $113,208 + $14,707)
  • gross tax of $88,472.80 ($188,240 × 47%).

Sam and Mark have an individual grossed-up non-rebatable amount greater than $30,000. Mark has an amount of $50,821.00 and Sam has an amount of $42,523.80. Sam's amount does not include the salary packaged entertainment as the value does not exceed the separate grossed-up cap ($2,295 × 1.8868 = $4,330.20).

The calculation of the aggregate non-rebatable amount is as follows:

  • 47% × [($50,821.00 − $30,000 − $5,000) + ($42,523.80 − $30,000)] = $13,322.05

The calculation of the rebate amount is as follows:

  • 47% × ($88,472.80 − $13,322.05) = $35,320.85 

Completing your FBT return

You would complete your FBT return as follows:

  • Item 14A is completed as $29,000 × 2.0802 = $60,325
  • Item 14B is completed as ($60,000 + $7,795) × 1.8868 = $67,795 × 1.8868 = $127,915
  • Item 14C is left blank
  • Item 15 is completed as items 14A + 14B = $60,325 + $127,915 = $188,240
  • Item 16 is 47% × $188,240 = $88,472.80
  • Item 17 is the aggregate non-rebatable amount = $13,322.05
  • Item 18 is 47% of (item 16 − item 17) = 47% × ($88,472.80 − $13,322.05) = $35,320.85
  • Item 19 is completed as (item 16 amount − item 18 amount) = ($88,472.80 − $35,320.85) = $53,151.95
  • Item 20 is completed as $16,000
  • Item 21 is completed as $37,151.95
  • Item 22 is left blank
  • Item 23 is completed as follows:
Example details of fringe benefits provided for Rebatable Employer return

Type of benefits provided

Code

Number

Gross taxable value (a)

Employee contribution (b)

Value of reductions (c)

Taxable value of benefits (a) − (b) − (c)

Cars using the statutory formula

A

2

29,000

0

 

29,000

Expense payments

E

 

60,000

0

0

60,000

Income tax exempt body – entertainment

L

 

7,795

 

 

7,795

 Extract of Items 14 to 23 of 2019 FBT return: • Item 14A Type 1 aggregate amount is $29,000 × 2.0802 = $60,325 • Item 14B Type 2 aggregate amount is ($60,000 + $7,795) × 1.8868 = $67,795 × 1.8868 = $127,915 • Item 14C is left blank • Item 15 Fringe benefits taxable amount ((A+B) or C) is $60,325 + $127,915 = $188,240 • Item 16 Amount of tax payable (47% of item 15 amount) is 47% × $188,240 = $88,472.80 • Item 17 Aggregate non-rebatable amount (only complete this item if you are a rebatable employer. Visit ato.gov.au/FBT2019 for more information) is $13,322.05 • Item 18 Amount of rebate (47% of (item 16 amount less item 17 amount) (only complete this item if you are a rebatable employer. Visit ato.gov.au/FBT2019 for more information) is 47% × ($88,472.80 − $13,322.05) = $35,320.85 • Item 19 Sub-total (item 16 amount less item 18 amount) is ($88,472.80 − $35,320.85) = $53,151.95 • Item 20 Less instalment amounts reported on activity statements (Visit ato.gov.au/FBT2019 for more information) is $16,000 • Item 21 Payment due is $37,151.95 • Item 22 is left blank • Item 23 Details of fringe benefits provided is as follows: • 23A Cars using the statutory formula, number is 2, gross taxable value is $29,000, employee contribution is $0 and taxable value of benefits is $29,000 • 23E Expense payments, gross taxable value is $60,000, employee contribution is $0, value of reductions is $0 and taxable value of benefits is $60,000 • 23L Income tax exempt body-entertainment, gross taxable value is $7,795 and taxable value of benefits is $7,795.

The other worked examples are:

Public benevolent institution return

You are a public benevolent institution that is registered for GST and provide your employees with the following fringe benefits:

  • car fringe benefits to Louise and Wendy valued at $2,000 and $25,000 respectively using the statutory formula method (type 1 benefits as you are entitled to GST credits for the provision of these benefits)
  • entertainment facility leasing expense benefits to Louise under a salary package arrangement to enable her to hire a room for $5,000 at Fantasy Wedding receptions (type 2 benefit as you are not entitled to a GST credit for the provision of this benefit)
  • entertainment facility leasing expense benefits to Wendy by reimbursing her $15,000 for the amount of rent she paid on hiring a houseboat on her holiday (type 2 benefit as you are not entitled to a GST credit for the provision of this benefit).

Louise's grossed-up type 1 amount is:

  • car fringe benefit = $4,160.40 ($2,000 × 2.0802).

Louise's grossed-up type 2 amount is:

  • salary packaged entertainment facility leasing expense benefit = $9,434.00 ($5,000 × 1.8868).

As the separate cap for salary packaged meal entertainment and entertainment facility leasing expense benefits has been exceeded (the grossed-up salary packaged meal entertainment and entertainment facility leasing expense benefits is $9,434.00), this amount is included in determining whether the capping threshold has been exceeded for benefits you provided to Louise.

Louise's aggregate exempt amount is:

  • = $8,594.40 ($4,160.40 + $9,434.00 − $5,000), which is less than the cap of $30,000.

Louise does not have a grossed-up non-exempt amount. You are not liable for FBT on the benefits you provide to Louise.

Wendy's grossed-up type 1 amount is:

  • car fringe benefit = $52,005.00 ($25,000 × 2.0802).

As the reimbursement of rent for the houseboat is not provided under a salary packaged arrangement it is not included in determining Wendy's individual grossed-up non-exempt amount. The capping threshold for Wendy has been exceeded and your aggregate non-exempt amount would be:

  • $52,005.00 − $30,000 = $22,005.00.

Completing your FBT return

You would complete your FBT return as follows:

  • Item 14C is completed as $22,005
  • Item 15 is completed as $22,005
  • Item 16 is completed as $22,005 × 0.47 = $10,342.35
  • Items 17 and 18 are left blank
  • Item 18 is left blank
  • Item 19 is completed as $10,342.35
  • Item 20 is completed as $16,000
  • Item 21 is left blank
  • Item 22 is completed as $5,657.65
  • Item 23 is completed as follows:
Example details of fringe benefits provided for Public benevolent institution employer return

Types of benefits provided

Code

Number

Gross taxable value (a)

Employee contribution (b)

Value of reductions (c)

Taxable value of benefits (a) − (b) − (c)

Cars using the statutory formula

A

2

27,000

0

 

27,000

Income tax exempt body – entertainment

L

 

5,000

 

 

5,000

The entertainment not provided under a salary sacrifice arrangement does not have to be shown at item 23.

Extract of Items 14 to 23 of 2019 FBT return: • Item 14C Aggregate non-exempt amount (hospitals, ambulances, public benevolent institutions and health promotion charities only) is $22,005 • Item 15 Fringe benefits taxable amount ((A+B) or C) is $22,005 • Item 16 Amount of tax payable (47% of item 15 amount) is $22,005 x 0.47 = $10,342.35 • Item 17 Aggregate non-rebatable amount (Only complete this item if you are a rebatable employer. Visit ato.gov.au/FBT2019 for more information) is $0 • Item 18 Amount of rebate (47% of (item 16 amount less item 17 amount) (Only complete this item if you are a rebatable employer. Visit ato.gov.au/FBT2019 for more information) is $0 • Item 19 Sub-total (item 16 amount less item 18 amount) is $10,342.35 – 0 = $10,342.35 • Item 20 Less instalment amounts reported on activity statements (Visit ato.gov.au/FBT2019 for more information) is $16,000 • Item 21 is left blank • Item 22 Credit due to you is $5,657.65 • Item 23 Details of fringe benefits provided is as follows: • 23A Cars using the statutory formula, number is 2, gross taxable value is $27,000, employee contribution is $0 and taxable value of benefits is $27,000. • 23L Income tax exempt body-entertainment, gross taxable value is $5,000 and taxable value of benefits is $5,000.

The other worked examples are:

QC58352