• 21.7 The otherwise deductible rule and jointly provided fringe benefits

    Where a fringe benefit (loan fringe benefit, expense payment fringe benefit, property fringe benefit or residual fringe benefit) is provided jointly to an employee and an associate in relation to an income producing asset, the taxable value of the fringe benefit can be reduced by the employee's share of any deductible amount. In these cases, the amount ascertained as the reduction available forms the 'unadjusted notional deduction', as described in sections 8.8A of Loan and debt waiver fringe benefits, 9.4A of Expense payment fringe benefits, 17.5A of Property fringe benefits and 18.7A of Residual fringe benefits.

    This rule also applies to car fringe benefits provided jointly to an employee and an associate for income producing purposes.

    Example:

    A car which is owned jointly by an employee and an associate (50% each) is applied by both persons to derive assessable income. A valuation under this chapter is required because of the extent of the documentation held. The deduction otherwise available under this chapter will be reduced to the employee's share of any deductible amount - that is, to 50% of the 'unadjusted notional deduction'.

      Last modified: 06 Dec 2011QC 17822