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  • Agenda items

    1. Opening of meeting including any changes to the agenda

    The Agenda for the meeting was confirmed without changes.

    Minutes of the previous meeting were confirmed without changes. Refer to FBT States and Territories Industry Partnership Minutes - 28 February 2017 (QC 53267).

    2. Items carried over from previous meetings

    2.1: Action item 4.15 of the FBT States and Territories Industry Partnership 28 February 2017 meeting

    2.1.1: Request that the ATO provide a webinar on 'FBT and entertainment' for government

    Update on action item

    The ATO provides a webinar on FBT for entertainment each year in November. It has been proposed that government-specific content be added to the November webinar to address some of the issues specific to government employers. The ATO FBT R&I team will consult with ATO Communications and Marketing as part of the 2017-18 planning process to seek the inclusion of this topic in its work program.

    While there was discussion about further action at this point, it was agreed that the best way to clarify further government entertainment issues is for members to discuss specific scenarios with us as the need arises.

    Action item 1

    STIP members to advise the FBT R&I team of relevant FBT on entertainment issues for which there was demand for specific guidance for further consideration.

    2.1.2: Changes to the PAYG payment summary

    Update on action item

    The ATO convened a phone conference on 28 March 2017 to discuss the changes to the 2017 PAYG payment summary. This item is now finalised.

    2.1.3: Extensions of time to lodge FBT returns

    Update on action item

    The ATO has reviewed its policies and processes governing the provision of lodgement and payment time extensions. It was noted during the meeting that the best way to lodge an application for an extension of time was online via the ATO Business Portal, as the progress of the application can be tracked online. The ATO also emphasised that due dates for payment and lodgement are two separate issues that require specific extension applications, where required, although they can be included in a single request.

    STIP members noted that when lodging an extension of time application in person at an ATO shopfront, a receipt acknowledging lodgement of the application was not provided.

    Action item 2:

    ATO to advise why shopfront's were not providing receipts on lodgement of applications for extension of time to lodge and/or pay.

    2.2: Action item 5.2 of the FBT States and Territories Industry Partnership 28 February 2017 meeting

    Update on action item

    See agenda item 4 of these minutes regarding a briefing provided by Peter Wynter from the ATO. This action item is closed.

    2.3 Action item 5.3 of the 28 February 2017 meeting Application of Practical Compliance Guideline PCG 2016/10 Fleet Cars: simplified approach for calculating car fringe benefits

    Update on action item

    We reviewed the information provided by STIP members about how shared services arrangements are structured and established in their jurisdictions and provided advice based on the facts submitted by a member. No further feedback on this issue has been received from STIP members. This item is now closed.

    Issue: Shared services arrangements

    Clarification is sought on the application of Practical Compliance Guideline PCG 2016/10 Fleet Cars: simplified approach for calculating car fringe benefits where departments and agencies within a particular State share fleet cars.

    Background

    Shared Services maintains and manages fleet cars. This includes the registration, insurance and acquisition of cars, as well as maintaining appropriate records for FBT purposes.

    The State Department, of which Shared Services is a function, is an eligible state or territory body that can be nominated as an employer for the purposes of the Fringe Benefits Tax Assessment Act 1986Footnote1. The State Department owns or leases the cars in the Shares Services’ fleet.

    Employees of the State Department, as well as employees of other departments or agencies within the State, are able to use a car within the Shared Services’ fleet. In order to book and use a car in the Shared Services’ fleet, employees of the relevant department or agency submit a form approved by their manager and advising Shared Services of the cost code. The employee records their travel undertaken in the log book for the car and Shared Services staff enter the log book details into a data base. This information is used to issue a tax invoice to the employee’s employer, being the relevant department or agency.

    As an illustration, Shared Services is a business unit of the Department of Treasury and Finance within a particular State (which has been nominated as an employer), therefore the Department of Treasury and Finance owns or leases the cars in the fleet. Under the Shared Services arrangement, the employees of the Department of Education (which has been nominated as an employer) can book and use cars in Shared Services’ fleet. The Department of Education is liable for any FBT that arises as a result of its employee using a car in Shared Services’ fleet for private purposes.

    Question

    How does PCG 2016/10 apply to situations where another department or agency allows its employees to use Shared Services cars?

    ATO response

    A department or agency (other than the State Department of which Shared Services is a function) can use the simplified approach to work out the average business use percentage outlined in PCG 2016/10 where its employees book and use 20 or more Shared Services cars throughout an FBT year and the requirements in paragraph 6 of the PCG are met. The department or agency should assume that the 20 or more cars used by its employees throughout the FBT year constitute its fleet for the purposes of PCG 2016/10.

    Shared Services is required to maintain records in order for the department or agency to calculate its car fringe benefits tax liability, which includes maintaining valid log books. The department or agency must have access to those parts of the log book in the log book year that account for the period(s) for which the car was booked by its employees.

    In order to use the simplified approach outlined in PCG 2016/10, the department or agency must have access to valid log books for at least 75% of the cars for the period(s) that the cars are booked by its employees.

    Explanation

    The State Department will be ‘a person’ that holds the cars and the provider of the car for the purposes of subsection 7(1) will be:

    • the State Department as the employer when an employee of the State Department uses the car; or
    • an associate of the State Department when an employee of another department uses the car.Footnote2

    The simplified approach outlined in PCG 2016/10 aims to assist employers with 20 or more eligible cars to obtain the necessary records to account for the car fringe benefits provided. The simplified approach operates within the parameters of the FBT law and when determining how the PCG operates reference must be made to already established definitions.

    To the extent that the use of a car by an employee of the State Department (of which Shared Services is a function) gives rise to a car fringe benefit, the State Department will be able to apply the simplified approach outlined in PCG 2016/10 provided the relevant criteria outlined in the PCG are satisfied.

    Where a car fringe benefit arises in respect of the use of a Shared Services’ car by an employee of another department or agency, that department or agency is able to apply the simplified approach in PCG 2016/10 only if it satisfies the relevant criteria for the period that its employees book and use the Shared Services car. The department or agency will not be able to include the period for which the car was used by employees of another department or agency.

    Applying this to the illustration provided above, the Department of Education is required to determine if it satisfies the criteria in paragraph 6 of PCG 2016/10 for the period or periods in which its employees book and use a Shared Services car.

    2.4: Action item 5.4 of the FBT States and Territories Industry Partnership 28 February 2017 meeting

    • Update on action item

    Item 5.1 of the FBT States and Territories Industry Partnership October 2016 meeting minutes has been updated.

    This item is now closed.

    2.5: Action item 3.1 of the FBT States and Territories Industry Partnership 6 March 2013 meeting

    Update on action item

    The Government has not introduced a miscellaneous tax amendments bill so far this year. The ATO will continue to administer this issue as previously advised.

    Action item 3:

    ATO to provide an update at next meeting.

    3. News from the ATO

    This item was tabled in the form of quarterly bulletins sent to STIP members since the last meeting. STIP members were invited to raise questions and comments on the content of the bulletins however no such questions or comments were raised. These minutes reflect the content of the bulletins sent to STIP members since the February 2017 meeting.

    3.1 What attracts our attention

    The ATO’s FBT compliance focus was recently published on What attracts our attention. The new content provides an overview of the ATO’s concerns regarding:

    • Motor vehicles
    • Car parking valuations
    • Employee contributions
    • Employer rebates
    • Living away from fome allowances
    • Non-lodgment

    The ATO is in the process of updating the Building-confidence site on www.ato.gov.au to outline the FBT priorities and issues that attract our attention.

    3.2 ATO updates

    Recent webinars

    New content on www.ato.gov.au

    3.3 ATO view updates

    3.3.1 Class rulings

    The following class rulings have been issued

    • CR 2017/8 Fringe benefits tax: employers who are clients of Westhill Pty Ltd as trustee for the ASP Trust trading as Airport Security Parking and who enter into a Corporate Bailment Agreement.
    • CR 2017/18 Fringe benefits tax: employer clients of McMillan Shakespeare Limited and its subsidiaries who participate in the fly-in fly-out travel program.
    • CR 2017/19 Fringe benefits tax: clients of Toyota Fleet Management, whose employees use the DriverDirect E-logbook for car log book and odometer records.
    • CR 2017/41 Fringe benefits tax: employer clients of Smartgroup Corporation Ltd who are subject to the provisions of section 57A or 65J of the Fringe Benefits Tax Assessment Act 1986 that make use of the Smartgroup Everyday Purchases Card facility.
    • CR 2017/40 Fringe benefits tax: employer clients of PBI Benefits Solutions Pty Ltd who are subject to the provisions of section 57A or 65J of the Fringe Benefits Tax Assessment Act 1986 whose employees make use of a PBI Solutions Everyday Purchases Card facility.
    • CR 2017/38 Fringe benefits tax: employer clients of Community Sector Banking Pty Limited who are subject to the provisions of either section 57A or 65J of the Fringe Benefits Tax Assessment Act 1986 that make use of a B-Maximised MasterCard credit card facility.
    • CR 2017/36 Fringe benefits tax: employer contributions to the Australian Construction Industry Redundancy Trust (ACIRT).
    • CR 2017/35Fringe benefits tax: corporate clients of Statewide Novated Leasing Pty Ltd and its subsidiaries (Statewide) who participate in Statewide's bus travel benefit scheme.
    • CR 2017/34 Fringe benefits tax: employer clients of Smartgroup Corporation Ltd who are subject to the provisions of section 57A or 65J of the Fringe Benefits Tax Assessment Act 1986 that make use of the Smartgroup Meals and Entertainment Card facility.
    • CR 2017/33 Fringe benefits tax: employer clients of PBI Benefit Solutions Pty Ltd who are subject to the provisions of section 57A or 65J of the Fringe Benefits Tax Assessment Act 1986 that make use of the PBI Solutions Meals and Entertainment Card facility.
    • CR 2016/85A1 Fringe benefits tax: employer clients of Community CPS Australia Limited trading as Beyond Bank Australia who are subject to the provisions of either section 57A or section 65J of the Fringe Benefits Tax Assessment Act 1986 and make use of the Meal Entertainment Card facility.
    • CR 2016/58A2 Fringe benefits tax: corporate clients of Smartgroup Corporation Ltd and its subsidiaries (Smartgroup) who participate in Smartgroup's bus travel benefit scheme.
    • CR 2016/18A1 Fringe benefits tax: employer clients of Community CPS Australia Limited trading as Beyond Bank Australia who are subject to the provisions of either section 57A or section 65J of the Fringe Benefits Tax Assessment Act 1986 and make use of the Salary Packaging Card facility.
    • CR 2015/111A1 Fringe benefits tax: corporate clients of McMillan Shakespeare Limited and its subsidiaries (McMillan Shakespeare) who participate in McMillan Shakespeare's bus travel benefit scheme.

    3.3.2 Taxation rulings

    The following tax rulings have been issued

    • TR 2017/D6 Income tax and fringe benefits tax: when are deductions allowed for employees' travel expenses? Refer to paragraph 10 of TR 2017/D6 for rulings that have been withdrawn because our views have been consolidated into this ruling.
    • TR 2017/D5 Income tax: employee remuneration trusts.

    The following TR of relevance has been updated:

    • TR 2005/16 Income tax: Pay As You Go - withholding from payments to employees.

    The following tax rulings have been withdrawn:

    • TR 2003/5W Income tax and fringe benefits tax: public benevolent institutions.
    • MT 2030W Fringe benefits tax: living-away-from-home allowance benefits.
    • TR 2014/D1W Income tax: employee remuneration trust arrangements.

    3.3.3 Taxation Determinations

    The following tax determinations have been issued:

    • TD 2017/2 Fringe benefits tax: for the purposes of section 135C of the Fringe Benefits Tax Assessment Act 1986, what is the exemption threshold for the fringe benefits tax year commencing on 1 April 2017?
    • TD 2017/3 Fringe benefits tax: what is the benchmark interest rate to be used for the fringe benefits tax year commencing on 1 April 2017?
    • TD 2017/4 Fringe benefits tax: what are the rates to be applied on a cents per kilometre basis for calculating the taxable value of a fringe benefit arising from the private use of a motor vehicle other than a car for the fringe benefits tax year commencing on 1 April 2017?
    • TD 2017/5 Fringe benefits tax: reasonable amounts under section 31G of the Fringe Benefits Tax Assessment Act 1986 for food and drink expenses incurred by employees receiving a living-away-from-home allowance fringe benefit for the fringe benefits tax year commencing on 1 April 2017
    • TD 2017/6 Fringe benefits tax: for the purposes of section 28 of the Fringe Benefits Tax Assessment Act 1986 what are the indexation factors for valuing non-remote housing for the fringe benefits tax year commencing on 1 April 2017?
    • TD 2017/14 Fringe benefits tax: for the purposes of section 39A of the Fringe Benefits Tax Assessment Act 1986 what is the car parking threshold for the fringe benefits tax year commencing on 1 April 2017?
    • TD 2017/19 Income tax: what are the reasonable travel and overtime meal allowance expense amounts for the 2017-18 income year?
    • TD 2017/18 Income tax: what is the car limit under section 40-230 of the Income Tax Assessment Act 1997 for 2017-18 financial year?
    • TD 2017/17 Income tax: what is the benchmark interest rate applicable for the year of income that commenced on 1 July 2017 for the purposes of Division 7A of Part III of the Income Tax Assessment Act 1936 and how is it used?

    The following tax determination of relevance has also issued:

    • LCTD 2017/1 Luxury car tax: what is the luxury car tax threshold and the fuel efficient car limit for 2017-18 financial year?

    The following tax determinations have been withdrawn:

    • TD 2011/2W Fringe benefits tax: for the purposes of section 135C of the Fringe Benefits Tax Assessment Act 1986, what is the exemption threshold for the fringe benefits tax year commencing on 1 April 2011?
    • TD 2011/3W Fringe benefits tax: for the purposes of section 28 of the Fringe Benefits Tax Assessment Act 1986 what are the indexation factors for valuing non remote housing for the fringe benefits tax year commencing on 1 April 2011?
    • TD 2011/4W Fringe benefits tax: for the purposes of Division 7 of Part III of the Fringe Benefits Tax Assessment Act 1986, what amount represents a reasonable food component of a living-away-from-home allowance for expatriate employees for the fringe benefits tax year commencing on 1 April 2011?
    • TD 2011/5W Fringe benefits tax: what are the rates to be applied on a cents per kilometre basis for calculating the taxable value of a fringe benefit arising from the private use of a motor vehicle other than a car for the fringe benefits tax year commencing on 1 April 2011?
    • TD 2011/6W Fringe benefits tax: what is the benchmark interest rate to be used for the fringe benefits tax year commencing on 1 April 2011?
    • TD 93/230W Income tax and fringe benefits tax: is a camping allowance assessable under section 30 of the Fringe Benefits Tax Assessment Act 1986 or under Division 6 of the Income Tax Assessment Act 1936?
    • TD 96/7W Fringe benefits tax: is fringe benefits tax payable on meals and accommodation provided to employees who work at remote construction sites, where the accommodation is not the usual place of residence of the employee?

    3.3.4 Interpretive Decisions

    The following Interpretive Decisions have been withdrawn

    • ATO ID 2004/294 (Withdrawn) ‘Otherwise deductible' rule: application to HECS fees reimbursed by the employer.
    • ATO ID 2002/848 (Withdrawn) Fringe Benefits tax: Employee Share Plan - Payments made by a Company to a Plan company.
    • ATO ID 2001/120 (Withdrawn) Fringe benefits tax: 'otherwise deductible' rule.

    The following ATO ID of relevance has been withdrawn:

    • ATO ID 2003/751 (withdrawn) Income tax: deductible gift recipient: meaning of 'the Commonwealth‘.

    3.4 Project refresh

    The following rewrite is being progressed:

    • TR 92/15 Income tax and fringe benefits tax: the difference between an allowance and a reimbursement.

    The following TR of relevance is being updated:

    • TR 2002/21Income tax: Pay As You Go (PAYG) Withholding from salary, wages, commissions, bonuses or allowances paid to office holders.

    3.5 Proposed changes to FBT legislation

    3.6 Advice under development program

    3.7 Reminders for 2017 FBT year

    • The simplified approach for calculating car fringe benefits under PCG 2016/10 may be applied.
    • FBT returns can be lodged electronically through PLS if you are a tax agent or Standard Business Reporting (SBR)-enabled software if you are not a tax agent.
    • Deferral requests can be lodged through the Business Portal or you can phone us on 13 28 66.
    • Legislative changes applying from 1 April 2016:
      • limit on concessional treatment of salary packaged meal entertainment benefits for not-for-profit employers.
      • all employers to report salary packaged entertainment benefits on employee payment summaries.
      • single basic car rate of 66 cents per kilometre for the purposes of the otherwise deductible rule for business use of employee cars.
       

    3.8 FBT rates and thresholds

    As part of the 2014-15 Federal budget the Government introduced a Temporary Budget Repair Levy which is a three-year progressive budget repair levy in the primary form of additional income tax on Australian resident and foreign resident individuals commencing in the 2014-15 financial year. The levy will cease to apply from 1 July 2017 but continues to have the following impacts on FBT rates and thresholds:

     

    31 March 2017

    31 March 2018

    FBT rate

    49%

    47%

    Type 1 gross up rate

    2.1463

    2.0802

    Type 2 gross up rate

    1.9608

    1.8868

    Reportable fringe benefits threshold for reporting on payment summaries (grossed up value)

    $3,921

    TBA

    FBT concession for PBIs (other than public hospitals) and health promotion charities

    FBT exemption capped at $31,177

    FBT exemption capped at $30,000

    FBT concession for public hospitals, non-profit hospitals and public ambulance services

    FBT exemption capped at $17,667

    FBT exemption capped at $17,000

    FBT concession for rebatable employers

    FBT rebate of 49% capped at $31,177

    FBT rebate of 47% capped at $30,000

    3.9 Other rates

    GIC and SIC rates July – September 2017

    The general interest charge (GIC) and shortfall interest charge (SIC) rates, and related rates, for the 1st quarter of the 2017–18 income tax year (1 July 2017 to 30 September 2017) are as follows:

    SIC rate is 4.73%

    SIC daily compounding rate is 0.01295890%

    GIC rate is 8.73%

    GIC daily compounding rate is 0.02391781%.

    Early payments, overpayments and delayed refunds interest

    The ATO website has a credit for interest on early payments calculator that calculates your entitlement to a credit for interest on early payment of tax made from 1 July 2013 to 30 September 2017 only. Credit for interest for overpayment of tax and delayed refunds of running balance account surpluses will be calculated by ATO automatically.

    The credit for interest on early payments calculator is available on the ATO’s website.

    Consumer price index (CPI) rates

    The CPI for the quarter ending 31 December 2016 is 110.0, an increase of 0.6 from the quarter ending 30 September 2016.

    The CPI indexation factor is used to determine the guideline price for repurchase of remote area residential property for the purposes of section 60 and 60AA of the FBTAA.

    The CPI rates are available on the ATO’s website.

    3.10 Key 2017 FBT dates

    Date

    Obligation

    21 October 2017

    Lodge and pay September 2017 monthly activity statement.

    28 October 2017

    Lodge and pay quarter 1, 2017–18 activity statement if lodging by paper. Pay quarter 1, 2017–18 instalment notice (form R, S, or T). Lodge the notice only if you vary the instalment amount.

    31 October 2017

    Final date to add new clients to your client list to ensure their 2017 tax return is covered by the lodgment program. Note: The lodgment program is a concession to registered agents. We can ask for documents to be lodged earlier than the concessional due dates.

    Lodge tax returns for all entities if one or more prior year returns were outstanding as at 30 June 2017.

    21 November 2017

    Lodge and pay October 2017 monthly activity statement.

    25 November 2017

    Lodge and pay quarter 1, 2017–18 activity statement if you lodge electronically.

    21 December 2017

    Lodge and pay November 2017 monthly activity statement.

    15 January 2018

    Lodge tax return for taxable large/medium entities as per the latest year lodged (all entities other than individuals), unless required earlier. Payment for large/medium entities with a 15 January due date is:

    • 1 December 2017 – for companies and super funds
    • for trusts – as stated on their notice of assessment.

    Note: You cannot self-assess a lodgment deferral from this date or assume a later date for lodgment on the basis that the taxpayer will be non-taxable in the current year.

    Lodge tax return for the taxable head company of a consolidated group (including a new registrant) that has a member who has been deemed a large/medium entity in the latest year lodged, unless the return was required earlier. Payment was due 1 December 2017.

    21 January 2018

    Lodge and pay December 2017 monthly business activity statement except for business clients with up to $10 million turnover who report GST monthly and lodge electronically.

    3.11 Making nominations

    States and Territories who want to nominate an eligible State or Territory body as an employer, or vary, or revoke a previous nomination from 1 April 2017 must make the nomination, variation or revocation by 21 May 2018.

    The form to be used when nominating an eligible state or territory body as an employer for FBT purposes or for varying, or revoking a nomination is available from the government home page of www.ato.gov.au (Fringe Benefit Tax: Nominate or revoke an eligible state or territory body) together with instructions for completing the form and the associated requirements.

    Reminders if making a nomination:

    • Nominations must be made on the approved form.
    • Each body being nominated should have been registered for FBT from 1 April 2017.
    • The prior year FBT return for the previous employer should be lodged by 21 May.
    • Consider if an agreement under section 135X of the FBTAA is required.

    Further information regarding nominated state or territory bodies and section 135X of the FBTAA agreements is available on the ATO website.

    3.12 Where to find FBT guidance on our website

    General FBT information

    Reporting, lodging and paying:

    Rates, calculators & tools:

    4. Overview of TR 2017/D6

    Peter Wynter from the ATO provided a presentation about TR 2017/D6.

    • The ruling covers both the deductibility under section 8-1 of the Income Tax Assessment Act 1997 (ITAA 1997), and the operation of the ‘otherwise deductible’ rule for FBT, in relation to:
      • transport costs (after the Federal Court decision in John Holland Group Pty Ltd & Anor v. FCT [2015] FCAFC 82), and
      • ‘accommodation, meal and incidental expenses’ of an employee when they work away from home.
       
    • It discusses the distinction between ‘travelling for work’ and ‘living away from home’ (Miscellaneous Taxation Ruling MT 2030 Fringe benefits tax: living-away-from-home allowance benefits has been withdrawn and, along with this, the ‘21 day’ rule has gone)
    • Apportionment of expenses, including where there is an incidental private component to the travel
    • Provides examples to draw out the principles, including fly-in fly-out employees’ travel arrangements and contemporary work arrangements an employee accesses work messages at home, and on the way to work, using digital technology.
    • It was explained that the draft ruling does not provide a discussion on the meaning of the term 'remote' and inclusion of such a discussion is not being considered. Peter Wynter mentioned that where the draft ruling refers to ’remote’ this should not be interpreted as reflecting the FBT meaning. As the examples of Raj (Example 2) and Aisha (Example 14) demonstrate, the deductibility of transport expenses, and the reasonableness of employers including travel in the employee’s income producing activities, depends on the circumstances.
    • A member noted that it would be useful to include a discussion of the meaning of the term 'incidental private travel' as it applies to employees. Peter Wynter stated whether a private component of travel is incidental depends on the circumstances, and further discussion about this is not being considered for inclusion in the draft ruling. Peter mentioned that the examples of Thérèse (Example 7) and Aruni (Example 8) demonstrate two of the more common situations raised by STIP members and other Government agencies.
    • Peter Wynter advised that he intends to work on additional material for the ATO website to cover dual purpose travel (where apportionment of expenses is required or the expenses are only partly 'otherwise deductible’).
    • Peter indicated that deductibility under section 8-1 of the ITAA 1997 and the basis of any apportionment depends on the specific facts and circumstances of the case. Peter indicated the general approach the ATO is looking to take in determining whether travel is incidental or ’dual purpose’ is to consider:
      • the impetus for the travel,
      • the additional costs of the activities unrelated to the activity that was the impetus for the travel, and,
      • the additional time period during which unrelated activities were undertaken - compared to the time spent on the activities which were the impetus for the travel.
       

    Action item 4:

    The ATO will provide details of ATO guidance describing appropriate apportionment methodologies to STIP members when it is published.

    5. Issues raised by the States and Territories

    5.1 Safety equipment (hiking boots)

    Issue

    Is an employer liable to FBT when it reimburses an employee for the amount of expenditure they incurred in purchasing hiking boots?

    Background

    Field staff, such as geologists, spend a considerable amount of time walking over rough and hostile terrain in undertaking their duties of employment. Hiking boots provide protection and support to field staff feet and ankles whilst traversing rough and rocky terrain. They also provide the grip to avoid slipping on rough terrain. Conventional boots would not provide the desired level of protection. An employer reimburses its field staff for the amount they incur (which may exceed $300) in purchasing such hiking boots.

    Industry view/suggested treatment

    Section 58X of the Fringe Benefits Tax Assessment Act 1986 (FBTAA) provides an FBT exemption for certain work related items primarily for use in the employee’s employment. Included in the list of eligible work related items is an item of protective clothing.

    The FBTAA does not contain a definition of ‘clothing’ so the ordinary meaning would apply. Boots would satisfy the ordinary meaning of ‘clothing’ contained in the Macquarie Concise Dictionary (4th Edition). The FBTAA does not define ‘protective’ so the ordinary meaning will apply. The Macquarie dictionary defines ‘protective’ as ‘cover or shield from injury or danger’ which is the purpose of the hiking boots. It is therefore concluded that the hiking boots are exempt from FBT under section 58X of the FBTAA.

    If it is not accepted that hiking boots are not exempt under section 58X of the FBTAA, then the reimbursement to employees would be an expense payment fringe benefit under section 20. Section 24 of the FBTAA allows a reduction to the taxable value of an expense payment fringe benefit under the ‘otherwise deductible rule’. This rule depends on the deductibility of the expense for income tax purposes.

    Taxation Ruling TR 2003/16 Income tax: deductibility of protective items provides guidance on the deductibility of protective items. The Ruling considers ‘protective items’ according to their design, properties and practical application to protect against illness or injury. Paragraph 8 of the Ruling states that expenditure on a protective item will have sufficient connection with the earning of the employee’s assessable income where:

    • The employee is exposed to the risk of illness or injury in the course of carrying out their income earning activities
    • The risk is not remote or negligible
    • The protective item is of a kind that provides protection from that risk and would reasonably be expected to be used in the circumstances, and
    • The employee uses the item in the course of carrying out their income earning activities.

    Travelling on foot in a rugged environment poses a very real risk of injury if the footwear worn is inadequate to cope with the environmental conditions. Slipping on rocks or twisting an ankle could result in an injury that is not a remote or negligible risk. Hiking boots provide the employee with a level of safety and protection from this risk in the course of the employee carrying out their income earning activities. This is supported by the fourth example at paragraph 11 of TR 2003/16 which refers to the item being made to cope with more rigorous work conditions.

    If it is considered that the otherwise deductible rule does not apply, the minor benefit exemption of section 58P of the FBTAA may be applicable. Taxation Ruling TR 2007/12 Fringe benefits tax: minor benefits provides guidance on the minor benefit exemption. A minor benefit is an exempt benefit where:

    • The notional taxable value of the minor benefit is less than $300; and,
    • It would be concluded that it would be unreasonable, having regard to the specified criteria in paragraph 58P(1)(f) of the FBTAA, to treat the minor benefit as a fringe benefit.

    The notional taxable value of the hiking boots may be more than $300 which excludes them from being considered for exemption as a minor benefit. However, if the reimbursement of boots is limited to less than $300, the reimbursement could be eligible for the minor benefit exemption.

    The boots are not reimbursed frequently but are reimbursed on a needs basis. With the wear and tear in traversing rugged terrain, more than one pair of boots could be reimbursed in the same FBT year resulting in the combined value of benefits exceeding $300. It is stated at paragraph 158 of TR 2007/12:

    Paragraph 58P(1)(a) requires the tests outlined in subsection 58P(1) be applied to each benefit provided to any particular employee. It is not applied to the total value of benefits provided to an employee, nor does it apply to the total value of benefits provided by any employer.

    The assessment of each pair of boots where the reimbursement is less than $300 would be similar to Example 1 at paragraph 24 of TR 2007/12 which concluded that it would be unreasonable to treat the benefit as a fringe benefit.

    Reference to other States and Territory

    May apply to other jurisdictions

    Technical references

    Sections 20, 58X, 58P of the FBTAA

    TR 2003/16

    TR 2007/12

    ATO response

    Under paragraph 58X(1)(a) of the FBTAA the provision of an expense payment benefit in respect of an eligible work related item is an exempt benefit.

    Subsection 58X(2) of the FBTAA lists the items that, if provided primarily for use in the employee’s employment, are ‘eligible work related items’ that may be subject to exemption. Included in this list, at paragraph (c), is ‘an item of protective clothing’. Therefore, the items of clothing that are provided to field staff will be eligible work related items if:

    • the clothing is protective clothing; and,
    • the clothing is primarily for use in the employee’s employment.

    The term ‘protective clothing’ is not defined in the FBTAA. The ATO outlines in TR 2003/16 examples of protective items and considers that the term ‘protective items’ means things that according to their design, properties and practical application, protect against illness or injury. The classification of the clothing as ‘protective’ will depend upon the function for which it is designed and the nature of the employee’s workplace, rather than the fact that it may comply with a standard.

    Field staff spend a considerable amount of time walking over rough and hostile terrain and, as such, wear hiking boots to protect them from the hazards and conditions that they are likely to encounter in performing these duties. As outlined in Example 5 of TR 2003/16, boots that are inherently protective would be considered to be a protective item for the purposes of paragraph 58X(1)(a) of the FBTAA. It is considered that hiking boots are a protective item and, when provided by an employer to its field employees, they are intended to be used principally to enable the employees to undertake their employment duties.

    In these circumstances, where an employer reimburses its field employees for the amount of the expenditure they incur in purchasing hiking boots, the provision of this expense payment fringe benefit is exempt from FBT under section 58X of the FBTAA. However, the exemption is only available to ‘an item’ of hiking boots per FBT year or to boots that are to replace boots provided earlier in the year that were an eligible work-related item at the time they were provided.

    5.2 Safety equipment (hydration packs)

    Issue

    Is an employer liable to FBT when it reimburses an employee for the amount of expenditure they incurred in purchasing hydration packs?

    Background

    Staff working outdoors in remote areas do not always have the luxury of a motor vehicle to carry essential needs such as water. The duties of some employees require them to travel to isolated areas not accessible by vehicle. In these cases the employee may need to travel through the bush by motor cycle or quad bike as far as possible then finish the trip by foot over rocky terrain and through heavy wooded areas.

    Working in these conditions in the heat of the day requires a good supply of water. The safe-keeping of the water whilst travelling by motor cycle or quad bike is absolutely necessary. The rough terrain can easily cause equipment, such as water bottles, to dislodge and fracture. When on foot it is important that the water container is protected and not subject to knocking or dropping on rocks due to the employee not having free hands when negotiating rough terrain. The amount of equipment that an employee can carry is limited but water is important for maintaining hydration.

    The employer reimburses employees undertaking these duties for their purchase of a hydration pack. A hydration pack may be dedicated to carrying water only or provide additional space for food and a few small work tools. The price of hydration packs range from $50 to $200 depending on the quantity of water required and if additional space is needed for food and other items. The packs are lightweight and resistant to abrasions and punctures. These are back packs that are secure and provide free hands when travelling by motor cycle or quad bike or on foot.

    Industry view/suggested treatment

    Section 58X of the FBTAA provides an FBT exemption for certain work related items primarily for use in the employee’s employment. The hydration pack is primarily for use in the employee’s employment. Included in the list of eligible work related items are:

    • An item of protective clothing; and
    • A tool of trade.

    The FBTAA does not contain a definition of ‘clothing’ so the ordinary meaning would apply. A back pack would not satisfy the ordinary meaning of ‘clothing’ contained in the Macquarie Concise Dictionary (4th Edition). The Macquarie dictionary has several meanings of ‘tool’ including ‘6. anything used regularly in the course of a particular profession or occupation’. The dictionary has several meanings of ‘trade’ including ‘a skilled occupation, especially one requiring manual labour’. When viewed together, a hydration pack could be a tool of trade because it is used regularly by employees in the course of their occupation which requires manual labour. This appears consistent with the approach adopted in ATO ID 2006/248 Fringe Benefits Tax Exempt Benefits: work related item - tool of trade.

    If the hydration pack is not accepted as a ‘tool of trade’, it would not qualify for exemption under section 58X of the FBTAA.

    The reimbursement to employees for the cost of a hydration pack is an expense payment fringe benefit under section 20 of the FBTAA. Section 24 of the FBTAA allows a reduction to the taxable value of an expense payment fringe benefit under the ‘otherwise deductible rule’. This rule depends on the deductibility of the expense for income tax purposes.

    Taxation Ruling TR 2003/16 provides guidance on the deductibility of protective items. The ruling considers ‘protective items’ according to their design, properties and practical application to protect against illness or injury. Paragraph 8 of the ruling states that expenditure on a protective item will have sufficient connection with the earning of the employee’s assessable income where:

    • The employee is exposed to the risk of illness or injury in the course of carrying out their income earning activities
    • The risk is not remote or negligible
    • The protective item is of a kind that provides protection from that risk and would reasonably be expected to be used in the circumstances, and
    • The employee uses the item in the course of carrying out their income earning activities.

    Working in hot, remote areas does present the risk of the serious medical condition of dehydration if there is insufficient water to hydrate the body. Loss of water due to fracturing a water container whilst travelling could result in exposure to dehydration which is not a remote or negligible risk. A hydration pack does protect the employee from this risk in the course of the employee carrying out their income earning activities. This is supported by the first example at paragraph 11 of TR 2003/16 which refers to extreme weather conditions.

    It is noted that a portable fridge is an allowable deduction in Taxation Ruling TR 95/18 Income tax: employee truck drivers-allowances, reimbursements and work-related deductions (paragraph 82) for truck drivers for the storage of food and drink while travelling for income-producing purposes.

    If it is considered that the otherwise deductible rule does not apply, the minor benefit exemption of section 58P may be applicable. Taxation Ruling TR 2007/12 provides guidance on the minor benefit exemption. A minor benefit is an exempt benefit where:

    • The notional taxable value of the minor benefit is less than $300, and
    • It would be concluded that it would be unreasonable, having regard to the specified criteria in paragraph 58P(1)(f), to treat the minor benefit as a fringe benefit.

    The notional taxable value of the hydration pack is less than $300. It is not provided frequently but may be provided regularly but not more than once per year. It is considered that Example 1 at paragraph 24 of TR 2007/12 is similar to this case in that a minor benefit may be provided on an annual basis. It was concluded in that example that it would be unreasonable to treat the benefit as a fringe benefit.

    Reference to other States and Territory

    Would apply to all jurisdictions

    Technical references

    Sections 20, 24, 58P and 58X of the FBTAA

    ATO ID 2006/248

    TR 2003/16

    TR 95/18

    TR 2007/12

    ATO Response

    As outlined in response to Agenda item 5.1, section 58X of the FBTAA exempts from FBT the provision of certain eligible work related items. Under paragraph 58X(2)(e) of the FBTAA a ‘tool of trade’ is considered to be an eligible work related item.

    The meaning as used in paragraph 58X(2)(e) of the FBTAA was discussed at the STIP meeting held on 9 September 2005 and it was noted:

    The meaning as used in paragraph 58X(2)(e) of the FBTAA was discussed at the meetings of the NTLG FBT sub-committee held on 14 March 1996 and 13 June 1996.

    At the meeting held on 14 March 1996 the Tax Office response stated a tool of trade has a common characteristic in that such tools must be manually operated. In support of this interpretation it quoted the definition of tool in the Macquarie dictionary where it is defined as:

    • an instrument, especially one held in the hand, for performing or facilitating mechanical operations, as a hammer, saw, file, etc. Any instrument of manual operation.

    The response went on to provide some examples by stating that a tool of trade will include ‘loose tools such as hammers, wrenches, chisels and so on and hand operated power tools such as drills, circular saws and so on’.

    Although the meaning of the expression has not been considered in the context of the FBTAA, it has been considered in several cases concerning Bankruptcy Law.

    For example, in Vaughn v. Official Trustee in Bankruptcy (1996) 71 FCR 34 the expression the Full Federal Court referred to the following definitions in The New Shorter Oxford English Dictionary (1993):

    Tool: 1. A thing used to apply manual force to an object or material, esp. a device designed for some particular mechanical function in a manual activity, as a hammer, a saw, a fork; an implement. Now also, a powered machine used for a similar purpose…2 trans. & fig. A thing (concrete or abstract) used in the carrying out of some occupation or pursuit; a means of effecting a purpose or facilitating an activity.

    Tools of Trade: The basic equipment required for a particular occupation.

    In Van Houwelingen, Re; Toledo-Berkel Pty Ltd v. Official Receiver in Bankruptcy (1953) 56 WALR 21 (Toledo-Berkel) Dwyer C.J (at pp23-24), in finding that an electrically operated cake mixer was not a tool of trade said:

    The expression tools of trade is perhaps not so definite in its significance as may at first appear.

    The judgement then referred to the Oxford and Webster Dictionary definitions before stating:

    A cab has been held by the Court of Appeal in England to be a tool of trade in certain circumstances, (see Lavell v. Richings); so has a piano and a sewing machine. These articles were at the material times in personal use by their operators for the purpose of subsistence. It appears necessary, therefore, to consider not only the article in its intrinsic nature, but also whether it is in use and by whom and the manner and circumstances of use.

    Possibly the nearest approach to the legalistic meaning may be found in Bouvier’s Dictionary, where the definition and illustrations are as follows:

    The implements which are commonly used by the hand of one man in some manual labour, necessary for his subsistence. It includes patterns used in manufacturing; a mill saw; an instrument called a billy and jennie; a gin and grist mill; a threshing machine. As used in exemption laws, it includes any instrument necessary for the prosecution of trade, including a lathe; sewing machines; a piano; a violin; a cornet; a gun; a net and boat; cheese vats; presses, and knives; the surgical instruments of a physician; and the office furniture of a lawyer; an iron safe used by an insurance agent; it does not include the apparatus of a printing office.

    These decisions illustrate that the question of whether something is a tool of trade will be a question of fact which will depend upon the particular circumstances of the case.

    It would appear, on balance, that a hydration pack may not be considered to be a tool of trade. However, different factual situations may alter the circumstances in which an item may be considered a tool of trade and further consideration would be required to determine if the item is exempt from FBT. STIP members are encouraged to engage with the ATO to discuss the particular factual circumstances early where such issues arise. To the extent that the reimbursement of the hydration pack results in a FBT, the taxable value of the item may be reduced if the otherwise deductible rule would apply. Alternatively the minor benefit exemption may apply if the notional taxable value of the benefit is less than $300 and it is unreasonable to treat the minor benefit as a fringe benefit. Note associated benefits must be considered when determining whether a minor benefit is exempt.

    5.3 Property benefit exemption

    Issue

    Is an employer liable to FBT when it provides its employees with food and drink at meetings held away from the normal workplace of the employees?

    Background

    Meetings are regularly held at small communities for consultative purposes. The venue of the meeting may be a community hall or a temporary shelter. Government employees attend these meetings that last several hours which include a lunch break. The government agency provides lunch for all participants including their employees. The lunch consists of finger food (e.g. sandwiches) and drinks but no alcohol. Lunch is consumed at the location of the meeting.

    Industry view/suggested treatment

    The provision of food and drink by the employer to their employees may be a tax-exempt body entertainment fringe benefit under section 38 of the FBTAA. Taxation Ruling TR 97/17 Income tax and fringe benefits tax: entertainment by way of food or drink provides guidance on entertainment by way of food or drink.

    Paragraph 19 of TR 97/17 states that the provision of food and drink to employees for morning or afternoon tea or for a light working lunch is not considered to be entertainment. Therefore, the provision of food and drinks to the employees at the meetings would not be a tax-exempt body entertainment fringe benefit.

    However, the provision of food and drink may be a property fringe benefit under section 40 of the FBTAA. Section 41 of the FBTAA provides an exemption for a property fringe benefit that is provided to, and consumed by, a current employee on business premises of the employer on a working day. The day the meetings are held is a working day for the employees and the food and drink is consumed at the location where the meeting is held.

    Section 136 of the FBTAA defines ‘business premises’ as premises, or a part of premises, of the person used, in whole or in part, for the purposes of business operations of the person, but does not include:

    (a) Premises, or a part of premises, used as a place of residence of an employee of the person or an employee of an associate of the person; or

    (b) A corporate box; or

    (c) Boats or planes used primarily for the purpose of providing entertainment unless the boat or plane is used in the person’s business of providing entertainment; or

    (d) Other premises used primarily for the purpose of providing entertainment unless the premises are used in the person’s business of providing entertainment.

    The exclusions provided at (a), (b), (c) and (d) above do not apply in this case.

    Taxation Ruling TR 2000/4 Fringe benefits tax: meaning of 'business premises' provides guidance on the meaning of business premises. Paragraph 4 of the TR 2000/4 states that premises will only be business premises if the following two requirements are met:

    (1) The premises or part of premises are ‘of’ the person; and

    (2) The premises or part of premises must be used by the person, in whole or in part, for the purposes of their business operations.

    Paragraph 13 of TR 2000/4 considers these two requirements are satisfied where in form and substance the person bears the rights and risks of possession of the premises associated with the conduct of the ‘business operations’. This indicates that there needs to be certain rights of occupancy and control of the premises.

    Paragraph 39 of TR 2000/4 refers to the definition of ‘business operations’ in relation to a government body or a non-profit company to include any operation or activity carried out by that body or company. The conducting of these meetings are activities carried out by the government agency. Therefore the meetings are business operations of the agency.

    Whilst requirement (2) above would be satisfied on the basis of the definition of ‘business operations’ for a government body, it is questionable if requirement (1) is satisfied. If a community hall is provided to the government agency for the day of the meeting, either free or for a fee, it can be argued that the premises are ‘of’ the government agency for that day.

    If accepted that the meetings are held on business premises on the days of the meetings, the consumption of food and drink by employees at these meetings would be exempt benefits under section 41 of the FBTAA.

    If the benefit is not an exempt benefit under section 41 of the FBTAA, the benefit may be an exempt minor benefit under section 58P of the FBTAA. Taxation ruling TR 2007/12 provides guidance on the minor benefit exemption. A minor benefit is an exempt benefit where:

    • The notional taxable value of the minor benefit is less than $300; and
    • It would be concluded that it would be unreasonable, having regard to the specified criteria in paragraph 58P(1)(f), to treat the minor benefit as a fringe benefit.

    The notional taxable value of the food and drink provided to individual employees at any one meeting would be well below $300. However, one of the criteria in paragraph 58P(1)(f) is that the benefits are provided infrequently and irregularly. Meetings are organised at regular intervals and an individual employee may attend up to 12 meetings in the FBT year.

    AAT Case 2/96 96 ATC 131 held that 48 taxi travel benefits were exempt minor benefits.

    Similarly, it is concluded that the property benefits provided to each employee in attending these meetings is an exempt minor benefit.

    Technical references

    Sections 38, 40, 41, 58P of the FBTAA

    TR 97/17

    TR 2000/4

    TR 2007/12

    ATO response

    Broadly speaking, a tax exempt body entertainment fringe benefit arises in situations where an employer who is partially or wholly exempt from income tax, provides entertainment to its employees for which it would not have been able to claim an income tax deduction had it been subject to income tax.

    Provision of entertainment

    The factors that need to be considered when determining whether the provision of food and drink amounts to the provision of entertainment are contained within TR 97/17. The ruling states that the determination of whether or not the provision of food or drink constitutes entertainment requires an objective analysis of all the circumstances surrounding that provision. The analysis should consider the following factors:

    • Why the food or drink is being provided to the employees
    • What food or drink is being provided to the employees
    • When is the food or drink provided
    • Where is the food or drink being provided.

    In this case, food is provided to the employees (and the community consultation participants) during a lunch break in the course of a meeting. The food and drink is a basic meal that is provided by way of refreshment; and consumed at the meeting location. On the surface it is considered that the lunch provided to the employees would not be entertainment by way of food or drink. However further details of each meeting will be required in order to accurately determine this.

    Food and drink provided on the business premises

    Section 41 of the FBTAA provides that food and drink will be an exempt benefit where it is provided to and consumed by a current employee:

    • on a working day,
    • on business premises of the employer; or if the employer is a company, of the employer or of a company that is related to the employer.

    It should be noted that this section will not usually apply to food and drink provided by an income tax exempt employer, if the food and drink constitutes the provision of entertainment. This is because the benefit provided is a tax-exempt body entertainment fringe benefit, rather than a property fringe benefit.

    Food and drink provided off business premises

    If the food and drink provided by the employer is not provided on business premises of the employer it will be a property fringe if it does not involve the provision of entertainment. In such a situation, the taxable value will only be reduced to nil if the employee would have been entitled to an income tax deduction had they had purchased the food and drink.

    Business premises of Government agencies

    Where the Government is the employer which has not disaggregated, the business premises include all those premises, or parts of those premises used in whole or in part for the business operations of that employer (refer definition ‘business premises’ subsection 136(1) of the FBTAA).

    ‘Business operations’ is defined in subsection 136(1), and in relation to a government body or non-profit company, includes any operations or activities carried out by that body or company.

    For a disaggregated State Government, each nominated body is an ‘employer’ for the purposes of the FBTAA (subsection 135U(1) of the FBTAA). Each nominated body is taken to be a company and a government body. Each of the nominated bodies and the State or Territory are taken to be related to each other for the purposes of the FBTAA (subsection 135U(5) of the FBTAA). Refer to Who is an associate? (QC19918) for further guidance on the relationship between government departments.

    In considering whether a community hall or a temporary shelter at which the meetings are held qualify as business premises of the government agency, an objective analysis of all the facts and circumstances is necessary. A person carries on business operations on a 'business premises' where in form and substance the person bears the rights and risks of possession of the premises associated with the conduct of the business operations. Apart from direct ownership, in most situations where premises are owned or held under a normal commercial lease, both possession and control exist. However where premises are hired on an ad hoc basis by an employer, they are more than likely not considered to be business premises of the employer. This is because any rights the employer has are subject to the overriding control of the operator such that in a practical sense, the premises are not those of the employer.

    The property benefit exemption applies where the benefit is provided on the business premises of the ‘employer’ or a company that is related to the employer. Therefore consideration of whether a particular premises is an associated premises of the government agency may be useful, i.e. to determine if the community hall or temporary shelter is the business premises of a related company and to this extent whether the property exemption applies. Furthermore, consideration would need to be given to determining whether the community hall is primarily used for the purpose of providing entertainment and would not be a business premises for the purposes of the FBTAA.

    The minor benefit exemption may apply if the notional taxable value of the lunches is less than $300 for each employee and it is unreasonable to treat the minor benefit as a fringe benefit e.g. the benefits are provided infrequently and irregularly . However associated benefits will need to be considered when determining minor benefit exemption.

    Discussion

    • A member raised the issue of difficulties in identifying the correct category of benefits between the different purposes of various meals, and the location of meals, where benefits were provided by a tax exempt body.
    • Action item 5: The ATO will provide additional content to the examples in agenda item 5.3 incorporating a discussion around the nature of the meal e.g. issues surrounding more substantive meals and the consumption of alcohol where the benefits are provided by tax exempt entities.
    • The ATO also encouraged STIP members to seek early engagements to address uncertainty arising from specific scenarios or schemes. Refer to Early engagement.

    6. General business

    6.1 Removing irritants and better support

    The ATO noted that it would like to continue to work with the States and Territories to identify irritants for government agencies and receive suggestions on how the ATO can better support the government sector.

    The ATO noted that it would like STIP members to please consider the following questions for discussion:

    • What issues do you anticipate the States and Territories will face in the future, from an FBT perspective?
    • How will the States and Territories be equipped to respond to these impacts?
    • What challenges to sustainability of compliance do the States and Territories face over the next few years?
    • How effective (in terms of ease and cost effectiveness, being contemporary and appropriately tailored) is the design of existing ATO systems for the administration of FBT?
    • How can any deficiencies be shaped to become more effective?

    A STIP member raised as an issue machinery of government (MoG) requirements imposed by section 135X of the FBTAA. She was particularly concerned with the employee-level reporting requirements where an employee is subject to an MoG change while their role and organisational context is not changing.

    Action item 6:

    The STIP member will provide more information on this issue to the ATO and the ATO will respond prior to the next meeting.

    6.2 Issues not discussed elsewhere

    • The ATO inquired as to STIP members experience with administering car parking fringe benefits or resolving interpretive difficulties concerning car parking fringe benefits generally. Noting that an issue had been raised concerning parking at hospitals in the previous STIP meeting, there was a general consensus that there was a demand for the provision of car parking benefits and the diversity of circumstances in which this occurred was often the cause of some problems for tax managers.

    The ATO noted that Taxation Ruling TR 96/26 Fringe benefits tax: car parking fringe benefits is being updated. Refer to Advice under development - FBT issues.

    Action item 7:

    The ATO will provide an update about the review of TR 96/26 at the next meeting.

    • STIP members raised concerns about the marketing of tax planning schemes coinciding with tax rate changes which took advantage of the gap between the FBT and income tax periods.

    The ATO noted that the opportunity to exploit differences between income tax and FBT rates arises due to the different tax year dates and that the issue is essentially the responsibility of Parliament. It is also noted that this issue has been discussed on the Board of Taxation's Sounding Board web pageExternal Link.

    6.3 Future STIP interactions and next meeting

    6.3.1 Location of next meeting

    The date for the next STIP Meeting was tentatively set for the 20th and 21st of March 2018 and is to be hosted in South Australia.

    Action Item 8:

    ATO to issue invitations to the next FBT STIP Meeting and to liaise with STIP members to promote engagement.

    6.3.2 Use of videoconference facilities at next meeting

    It was noted that the ATO was exploring the use of new technology to reduce the cost and burden imposed on members to travel for STIP meetings. The ATO advised that its videoconference facilities would be made available for the next meeting, and that the same would be offered to STIP members in respect of members attending the GST STIP. This would require STIP members to travel to an ATO site with videoconferencing facilities however it would not preclude state and territory representatives travelling to the meeting location. STIP members could choose to participate in the STIP from an ATO site in their state capital or other relevant site such as Parramatta.

    STIP members noted that the STIP relationship was very important. It was generally agreed that all STIP members would like to make use of the videoconferencing technology in future meetings so as to reduce costs associated with the STIP.

    Action item 9:

    ATO to provide details of ATO sites with videoconferencing facilities to members and to make arrangements to secure use of the facilities for the next meeting.

    7. Summary of action items

    The action items from the meeting are summarised in the table below

    Action Item

    Description

    Responsibility

    Due date

    1

    STIP members to advise of relevant FBT on entertainment issues for which there was demand for specific guidance.

    STIP members

    Next meeting

    2

    Provide an explanation as to why shopfront's were not providing receipts on lodgment of applications for extension of time to lodge and/or pay.

    ATO

    Next meeting

    3

    Provide update regarding the misalignment of State legislation with section 135T of the FBTAA

    ATO

    Next meeting

    4

    Provide details of ATO guidance describing appropriate apportionment methodologies to members when it is published.

    ATO

    Next meeting

    5

    Provide additional content to the examples in agenda item 5.3 incorporating a discussion around the nature of the meal e.g. issues surrounding more substantive meals and the consumption of alcohol where the benefits are provided by tax exempt

    ATO

    Next meeting

    6

    STIP member will provide more information to the ATO on the issue of employee-level reporting requirements under a MoG change, and the ATO will respond prior to the next meeting.

    STIP Member and ATO

    Next meeting

    7

    Provide an update as to the finalisation of the review of TR 96/26.

    ATO

    Next meeting

    8

    Send invites for the next FBT STIP and to liaise with STIP members to promote engagement.

    ATO

    Next meeting

    9

    Provide details of ATO sites with videoconferencing facilities to members.

    ATO

    Next meeting

    Footnote 1
    All legislative references are to this Act.

    Return to footnote 1 referrer

    Footnote 2
    Refer to private ruling (Authorisation Number 1011799417952)

    Return to footnote 2 referrer

      Last modified: 18 Dec 2017QC 54112