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  • How to make a nomination

    In making a nomination, a state or territory is able to nominate:

    • an eligible state or territory body as an employer for the purposes of the FBTAA
    • that a class (or classes) of employees, who don't perform their duties of employment wholly or principally in a nominated state or territory body, are to be taken to have a sufficient connection with a nominated state or territory body.

    A nomination only needs to be made for the first year in which the body is to be treated as an employer.

    Next step:

    Use the Fringe benefits tax: Nominate or revoke an eligible state or territory body form to make a nomination.

    Complete the form online, then print, sign and send it to:

    Australian Taxation Office
    PO Box 3006
    Penrith  NSW  2740

    How to complete the form

    The following instructions explain in the requirements of different parts of the form.

    Complete Part A to nominate an eligible state or territory body as an employer, or to specify a class of employees as having a sufficient connection with a nominated body.

    Complete Part B to report details of state or territory bodies ceasing to be an employer.

    To tell us the allocation of the notional tax to the nominated bodies, complete parts C and D.

    In Part C, provide details of the amounts of tax payable by the entities that were the employer of the employees in the previous FBT year. If a nomination is being made, it is only necessary to complete:

    • column (a) – name of previous employer
    • column (b) – tax file number (TFN) of the previous employer
    • column (c) – the amount of tax that was paid by the previous employer in the prior year.

    Columns (d) and (e) are completed if a nominated body ceases to exist during the year and you need to allocate the instalments that would have been paid by the body for the remainder of the FBT year to the state or territory.

    Part D requests details of the name, TFN and amount of tax that is to be allocated to each of the nominated bodies replacing the bodies reported in parts B and C. This amount will be the total instalments to be paid by the newly nominated body.

    The total notional tax in Part D (the total instalments to be paid by the newly nominated bodies) must equal the total of column (c) in Part C (the amount of FBT paid by the previous employers in the prior FBT year).

    Register the body for fringe benefits tax

    To be treated as an employer for the purposes of the FBTAA, a body must be both nominated and registered. Although the Application to register for fringe benefits tax can be lodged at any time during the year, the body will not be treated as an employer until it is nominated.

    Next step:

    Lodge prior-year FBT returns

    If relevant, the bodies previously treated as the employer (the state or territory, or a nominated body) must lodge their prior year FBT return by 21 May.

    Consider a section 135X agreement

    As the calculation of the taxable value of certain fringe benefits can be affected by the change in employer, section 135X of the FBTAA enables us to enter into a written agreement with a state or territory to:

    • ensure the calculation of the taxable value of certain fringe benefits is not affected by a break in continuity of certain record-keeping requirements solely because of a 'transitional event'
    • preserve the character of certain benefits where the character would otherwise be lost solely because of a 'transitional event'.

    A transitional event occurs when either:

    • a nominated state or territory body ceases to exist
    • a state or territory
      • makes a nomination
      • varies a nomination, or
      • revokes a nomination.
       

    When one of these events occur, a written agreement may be entered into for the application of any or all of the following provisions of the FBTAA:

    • Section 10 – whether a year of tax is to be treated as a log book year of tax for the purposes of calculating the taxable value of car fringe benefits using the cost basis
    • Section 26 – whether a year of tax that is a base year of tax for the purpose of calculating the statutory annual value of a current housing right is to continue to be treated as a base year of tax
    • Sections 39G to 39GH – whether a register kept in relation to the value of car parking fringe benefits is a valid register
    • Sections 58B to 58D – whether a benefit is an exempt benefit as a result of the relocation of an employee
    • Section 58S – whether a benefit is an exempt benefit in relation to trainees engaged under the Australian traineeship system
    • Section 65CA – whether a fringe benefit is an amortised fringe benefit relating to remote area home ownership schemes
    • Section 152A – whether a benefit is covered by a recurring fringe benefit declaration.

    A state or territory wanting to enter into a section 135X agreement should apply for a private ruling, noting in the 'Question' or 'Other comments' field that it is an FBT transition 135X agreement, and send the request to:

    Australian Taxation Office
    PO Box 3000
    Penrith  NSW  2740

    When a nominated body ceases to exist part-way through the FBT year, the state or territory may need to enter into more than one agreement to cover both:

    • the transfer of employees from the body that ceased to exist to the state and territory
    • the subsequent transfer from the state or territory to the newly created body at the start of the new FBT year.

    The following example shows the wording that can be used by a state or territory seeking to enter into a written agreement under subsection 135X(3).

    Example – Request for an FBT 135X agreement

    The [name of state or territory] seeks to enter into an agreement with the Commissioner of Taxation under subsection 135X(3) of the FBTAA to:

    • ensure the calculation of the taxable value of certain fringe benefits previously provided by the bodies listed below is not affected as a result of a break in the continuity of certain record keeping requirements solely because of a transitional event
    • preserve the character of certain benefits where the character would otherwise be lost solely because of a transitional event.

    The agreement relates to records kept by the following bodies previously taken to be the employer(s) for the purposes of the FBTAA:

    [Insert names of previous employers]

    These employers ceased to be the employer on [insert date of transitional event] as a result of [insert details of transitional event].

    The following bodies will be taken to be the employers of the employees:

    [insert names of new employers]

    The agreement is sought to enable the new employer to: [delete any provisions that are not relevant]

    • Treat a year which would have been a log book year of tax for the previous employer as a log book year for the purpose of using section 10 of the FBTAA to calculate the taxable value of a car fringe benefit.
    • Treat a year of tax that would have been a base year of tax for the previous employer as a base year for the purpose of calculating the taxable value of a housing fringe benefit under section 26 of the FBTAA.
    • Treat a register that would have been a valid register for the previous employer as a valid register for the purpose of using the 12-week record-keeping method in Subdivision D of Division 10A of the FBTAA to calculate the taxable value of car parking fringe benefits.
    • Treat a benefit relating to the relocation of an employee that would have been an exempt benefit for the previous employer under sections 58B, 58C or 58D of the FBTAA as an exempt benefit.
    • Treat a benefit relating to trainees engaged under the Australian traineeship system that would have been an exempt benefit for the previous employer under section 58S of the FBTAA as an exempt benefit.
    • Use the end date that would have been used by the previous employer for the purpose of calculating the amortisation of the taxable value of fringe benefits relating to a remote area home ownership scheme under section 65CA of the FBTAA.
    End of example
      Last modified: 06 Dec 2019QC 20311