• 6 Legislation and Regulations


    Reforms to in-house fringe benefits were introduced to Parliament 29 November 2012.

    Royal Assent was given on 28 June 2013.

    Schedule 7 of the Act contains reforms to the valuation of the taxable value of in-house fringe benefits provided under a salary packaging arrangement.

    In-house fringe benefits under salary packaging arrangements are discussed at pages 79 to 91 of the Explanatory Memorandum to the Bill.

    Treasury had published information about the transitional arrangements for the measure on their website, entitled In-House Fringe Benefits – transitional arrangementsExternal Link.

    On 22 October 2012, the Government announced as part of the 2012-13 Mid-Year Economic and Fiscal Outlook that the concessional tax treatment of in-house fringe benefits would be removed if they are accessed through a salary sacrifice arrangement.
    This announcement included generous transitional arrangements for salary sacrifice arrangements that were entered into prior to 22 October 2012. These salary sacrifice arrangements will be able to continue to access the concessional tax treatment for a further 17 months, until 31 March 2014.
    Salary sacrifice arrangements that were entered into on or after 22 October 2012 will not be able to access the transitional arrangements. The new rules will apply to these salary sacrifice arrangements from 22 October 2012.
    The transitional rules are intended to cover binding arrangements that were agreed to prior to 22 October 2012. This will be satisfied if both the offer by the employer and the acceptance by the employee occurred prior to 22 October 2012. There is no requirement for the actual reduction of salary and wages, or the provision of goods and services, to occur prior to 22 October 2012.
    Meeting Discussion
    In response to a question about the information that will be available about the changes, the ATO advised members of the update to Fringe benefits tax: a guide for employers and associated publications that will issue in relation to the in-house valuation reforms. The ATO undertook to advise members when the publications issue.

    Reforms to the Airline Transport Fringe Benefits were introduced into Parliament on 13 February 2013.

    Royal Assent was given on 28 June 2013

    The reforms are contained in Schedule 2 to the Act.

    The reforms are discussed in the Explanatory MemorandumExternal Link to the Bill at pages 21 to 35.

    Fringe Benefits Tax Amendment (Disability Care Australia) Act 2013 (Act No. 39 of 2013)

    Increases the fringe benefits tax rate from 46.5% to 47% from 1 April 2014. The increase as a result of the increase in the Medicare Levy following the introduction of the National Disability Insurance Scheme.

    Royal Assent received 28 May 2013.

    Schedule 11 to this Bill makes a number of miscellaneous amendments to the taxation and superannuation laws. These amendments are part of the Government‘s commitment to the care and maintenance of the taxation and superannuation systems.

    Royal Assent was given on 28 June 2013.

    The Revised Explanatory Memorandum to the Bill states, in part:

    Part 3 – Fringe benefits tax minor amendments
    9.21 This Part contains minor amendments to ensure that certain provisions in the Fringe Benefits Tax Assessment Act 1986 (FBTAA) operate effectively and as intended by Parliament.
    9.22 Section 65J of the FBTAA sets out the categories of employers that are able to access a fringe benefits tax rebate. These employers include registered charities, scientific institutions and public educational institutions.
    9.23 The amendments in Part 3 of this Schedule introduce minor changes to correct anomalies that resulted from consequential amendments contained in the Australian Charities and Not-for-profits Commission (Consequential and Transitional) Act 2012 that did not entirely achieve Parliament‘s intention.
    Application provision
    9.27 The amendments in Part 3 apply for the 2013-14 fringe benefit tax (FBT) year and later FBT years.
    9.28 The 2013-14 FBT year has already commenced, however, as discussed above, these amendments essentially confirm existing practice and ensure the law operates in accordance with the policy intent behind the provisions.
    9.29 These amendments provide greater certainty for taxpayers by ensuring that the effect of section 65J is largely unchanged from that which existed prior to the commencement of the ACNC Act, with updates to the terminology and structure of the section.
    9.30 The amendments apply prospectively in that they do not affect any existing entitlements prior to the commencement of this legislation. This is because Part 3 applies to endorsements for the FBT rebate by the Commissioner of Taxation after the commencement of this legislation, and the amendments do not adversely affect any entity which has already been endorsed by the Commissioner of Taxation.
    9.31 Where an entity has been endorsed under subsection 123E(1) of the FBTAA immediately before the commencement of Part 3, the amendments apply to an entity for the 2014-15 FBT year and later FBT years. This reflects that the entity will have already been endorsed for the 2013-14 FBT year, so it would be inappropriate to change the requirements for these entities part way through an FBT year.
    9.32 A transitional provision is inserted so that an endorsement in place at the end of the 2013-14 FBT year will continue to have effect as if it were an endorsement under subsection 123E(1) of the FBTAA as amended by this Schedule. This means that an entity endorsed under the old regime of section 65J need not seek re-endorsement following these amendments.

    This Bill was introduced on 23 August 2012 however there has been no further progress; the Bill amends taxation legislation to: restate the ‘in Australia’ special conditions for income tax exempt entities, ensuring that they generally must be operated principally in Australia and for the broad benefit of the Australian community; standardise the other special conditions entities must meet to be income tax exempt; standardise the term ‘not-for-profit’; and codify the ‘in Australia’ special conditions for deductible gift recipients ensuring that they must generally operate solely in Australia, and pursue their purposes solely in Australia (with some exceptions, such as overseas aid funds and some environmental organisations).

    This Bill includes amendments to the FBTAA.

    Note: The 43rd Parliament was prorogued at 5.29pm on 5 August 2013 and the House of Representatives was dissolved at 5.30pm on the same day. A general election for the House of Representatives and half of the Senate will be held on 7 September 2013. All Bills that had not passed both Houses of Parliament have now lapsed. This included Tax Laws Amendment (Special Conditions for Not-for-profit Concessions) Bill 2012External Link which was still before the House of Representatives when Parliament adjourned on 28 June 2013.


    The purpose of this Regulation is to exclude living-away-from-home (LAFH) allowances and benefits, including certain expense payment benefits and residual benefits, from being reportable fringe benefits for Commonwealth employees posted both overseas and domestically.

    The Regulation also renumbers the sections so that they run sequentially and replaces the former regulation 3F which deals with pooled or shared cars with a new regulation 8 which has been rewritten to improve readability. There is no change to the policy intent or operation of the regulation.

      Last modified: 03 Feb 2014QC 38409