• Car parking fringe benefits

     

    Attention

    This information forms Chapter 16 of Fringe benefits tax - a guide for employers.

    Remember, a fringe benefit may be provided by another person on behalf of an employer. It may also be provided to another person on behalf of an employee (for example, a relative).

    End of attention

    16.1 What is a car parking fringe benefit?

    Very broadly, a car parking fringe benefit may arise for each day on which you (the employer) provide a car parking space for the use of an employee.

    Specifically, a car parking fringe benefit arises during a fringe benefits tax (FBT) year only if all of the following conditions are satisfied:

    • a car is parked at premises that are owned or leased by, or otherwise under the control of, the provider (usually you as the employer)
    • within a one-kilometre radius of the premises on which the car is parked, there is a commercial parking station that charges a fee for all-day parking, which is more than the car parking threshold
    • the car is parked for a total of more than four hours between 7.00am and 7.00pm on the day
    • the car is owned by, leased to, or otherwise under the control of, an employee, or is provided by you
    • the parking is provided in respect of the employee's employment
    • the car is parked at or near the employee's primary place of employment on that day
    • the car is used by the employee to travel between home and work (or work and home) at least once on that day
    • the commercial parking station referred to above must also, on the first business day of the FBT year, charge a representative fee for all-day parking that is more than the car parking threshold.

     

    If...

    then...

    • a commercial car parking station commences to operate during the FBT year
    • has not charged a fee for all day parking on the first business day of that FBT year, and
    • the other conditions of a car parking fringe benefit are met
     

    a car parking fringe benefit will not arise during that FBT year.

    However, car parking fringe benefits may arise during the following FBT year.

    • a commercial car parking station commences to operate on the first business day of the FBT year
    • does not charge a fee for all day parking that is more than the car parking threshold, and
    • the other conditions for a car parking fringe benefit are met
     

    a car parking fringe benefit will not arise during that FBT year.

    • a commercial car parking station commences to operate on the first business day of the FBT year
    • charges a fee for all day parking that is more than the car parking threshold
    • ceases to operate during that FBT year, and
    • there are no other commercial car parks within a one kilometre radius that charge a fee more than the car parking threshold
     

    car parking fringe benefits are only provided during the period that the commercial car park had operated.

    • a commercial car parking station commences to operate on the first business day of the FBT year
    • charges a fee for all day parking that is more than the car parking threshold
    • ceases to operate during that FBT year, and
    • there are other commercial car parks within a one kilometre radius that charge a fee more than the car parking threshold
     

    car parking fringe benefits will continue to arise while there is a commercial car park within a one kilometre radius that charges a fee that is more than the car parking threshold.

    Car

    The meaning of 'car' is described in section 7.1 of Car fringe benefits.

    Commercial parking station

    A commercial car parking station is one that charges a fee for all-day parking, is permanent, and is commercial (that is, it operates with a view to making a profit).

    All-day parking

    All-day parking means parking for a continuous period of at least six hours between 7.00am and 7.00pm.

    One-kilometre radius

    The one-kilometre distance is measured not by radius but by the shortest practicable direct route (by whatever means this route is travelled, for example, by foot, car or boat).

    Primary place of employment

    The employee's primary place of employment is your premises at which the employee performs the majority of their employment-related duties on a particular day.

    Car parking threshold

    The car parking threshold is indexed in line with movements in the consumer price index. The table below lists the car parking thresholds from 2003 to 2013.

     

    Year ending 31 March

    Threshold

    2013

    $7.83

    2012

    $7.71

    2011

    $7.46

    2010

    $7.25

    2009

    $7.07

    2008

    $6.78

    2007

    $6.62

    2006

    $6.43

    2005

    $6.28

    2004

    $6.16

    2003

    $5.96

    Representative fee

    The fee for any particular day is not representative if it differs substantially from the average lowest fee ordinarily charged for all-day parking. For this purpose, you can compare the fee for a particular day with the average fee charged during a four-week period beginning or ending on that particular day.

    Example
    An employee of a company has a car provided by the company and is allowed to park the car in the basement of the company's building. The employee uses the car to drive to and from work each day. Other employees use the car during the day for business purposes. There is a parking station within one kilometre that charged more than $7.07 a day on 1 April 2008.

    On a particular day the car is parked in the basement for three hours and taken out by the employee to visit clients. The employee does not return to work that day but goes straight home after visiting the last client. As the car is not parked in the basement for more than four hours, a car parking fringe benefit is not provided on that day.

    On a different day the car is parked in the basement for three hours before another employee takes it out and uses it for deliveries. The car is returned in the afternoon and parked in the basement for another two hours. As the car is parked on the employer's premises for more than four hours between 7.00am and 7.00pm, a car parking fringe benefit has been provided.

      Last modified: 05 Jul 2012QC 17813