The requirement to obtain an employee declaration is waived if the provision of the fringe benefit is covered by a recurring fringe benefit declaration.
A fringe benefit is covered by a recurring fringe benefit declaration if:
- it is provided no later than five years after the day the declaration was made
- the deductible proportion of the benefit is not significantly less than the deductible proportion of the benefit for which the declaration was first provided (a difference of more than 10 percentage points is regarded as being significant)
- it is 'identical' to the fringe benefit for which the declaration was first made.
Benefits are to be treated as being identical if they are the same in all respects except for any differences that:
- are minimal or insignificant
- relate to the value of the benefits, or
- relate to the deductible proportion of the benefits.
A recurring fringe benefit declaration is automatically revoked by a later declaration made for an identical benefit. This means that the earlier declaration applies to the first benefit and to any identical benefits provided before the later declaration was made. The later declaration applies to the benefit for which it was provided and to any identical benefits provided subsequently.
Example: recurring fringe benefit declaration
An employer regularly reimburses an employee for the cost of home telephone expenses. This is an expense payment fringe benefit. The employee gives the employer a recurring fringe benefit declaration which specifies that the deductible proportion of the expenses is 80%. The declaration will cover all further reimbursements in relation to telephone costs over the next five years if the employment-related use of the telephone is not less than 70%. If the employment-related use of the telephone drops to less than 70%, another declaration is required.
To obtain a Recurring expense payment fringe benefit declaration, refer to Declarations.