• FBT - Introducing a cap for salary sacrificed meal entertainment and entertainment facility leasing expenses

    In the 2015 - 16 Budget, the Government announced the introduction of a separate single grossed up cap of $5,000 for salary sacrificed meal entertainment and entertainment facility leasing expenses (meal entertainment benefits) for employees. Meal entertainment benefits exceeding the separate grossed up cap of $5,000 can also be counted in calculating whether an employee exceeds their existing fringe benefits tax (FBT) exemption or rebate cap. All use of meal entertainment benefits will become reportable.

    Currently, employees of public benevolent institutions and health promotion charities have a standard $30,000 FBT exemption cap (this will be $31,177 for the first year of the measure, due to the Temporary Budget Repair Levy) and employees of public and not for profit hospitals and public ambulance services have a standard $17,000 FBT exemption cap (this will be $17,667 for the first year).

    In addition to these FBT exemptions, these employees can salary sacrifice meal entertainment benefits with no FBT payable by the employer and without it being reported. Employees of rebatable not for profit organisations can also salary sacrifice meal entertainment benefits, but the employers only receive a partial FBT rebate, up to a standard $30,000 cap ($31,177 for the first year).

    This measure will apply prospectively from 1 April 2016 to coincide with the start of the FBT year.

    Legislation and supporting material

    Find out more

    Public exposure draftExternal Link issued 29 June 2015 by the Treasury

    Treasury received 64 SubmissionsExternal Link

    Budget 2015 - Fairness in Tax and Benefits (PDF 3MB)External Link

    2015 -16 Budget Paper No 2 - Revenue Measures page 22 (PDF 600KB)External Link

      Last modified: 11 Dec 2015QC 45160