• 20.5 Religious and non-profit organisation exemptions

    Registered religious institutions

    Benefits provided by registered religious institutions to a religious practitioner are exempt benefits if the benefits are provided principally because of the practitioner's pastoral duties or any other duties relating to the practice, study, teaching or propagation of religious beliefs.

    A religious practitioner is someone who is any of the following:

    • a minister of religion
    • a student at an institution who is undertaking a course of instruction in the duties of a minister of religion
    • a full-time member of a religious order
    • a student at a college conducted solely for training people to become a member of a religious order.

    See also:

    • TR 92/17 Income tax and fringe benefits tax: exemptions for 'religious institution'

    Registered public benevolent institutions, registered health promotion charities, some hospitals and public ambulance services

    Registered public benevolent institutions and registered health promotion charities

    A public benevolent institution (PBI) is distinct from a charitable institution. Generally, an organisation is recognised as a PBI if its principal objects are the relief of poverty, sickness, suffering, distress, misfortune, destitution or helplessness, and its activities are carried on without the purpose of private gain for particular people.

    A health promotion charity (HPC) is a non-profit charitable institution whose principal activity is promoting the prevention or control of diseases in human beings.

    An institution with charitable activities, but which doesn't have as its principal objects the provision of such relief, is not a PBI.

    From 3 December 2012, all PBIs and HPCs have to be registered with the ACNC and endorsed by us in order to claim FBT concessions.

    Benefits you provide to your employees are exempt from FBT where the total grossed-up taxable value of certain fringe benefits for each employee during the FBT year is $30,000 or less.

    If your employees receive benefits above this threshold you are liable for FBT on the excess (or the aggregate non-exempt amount).

    For more on registered and endorsed PBIs and registered and endorsed HPCs, refer to Non-profit organisations and fringe benefits tax.

    Benefits exempted by this provision may be subject to fringe benefits reporting requirements as explained in Reportable fringe benefits.

    Public and non-profit hospitals and public ambulance services

    Public and non-profit hospitals and public ambulance services are exempt from FBT if the grossed-up taxable value of certain fringe benefits provided to each employee is less than the relevant cap.

    If your employees receive benefits above this threshold, you are liable for FBT on the excess (or the aggregate non-exempt amount).

    See also:

    • Non-profit organisations and fringe benefits tax – for more on public and non-profit hospitals and public ambulance services.

    Benefits exempted by this provision may be subject to fringe benefits reporting requirements as explained in Reportable fringe benefits.

    Live-in residential care workers

    Accommodation, residential fuel, meals or other food and drink provided to employees (and their spouse or children) of government bodies, registered religious institutions and non-profit organisations, may be exempt benefits.

    The exemption applies only where employees are engaged in caring for elderly or disadvantaged people or their children who reside with them. The employees must also reside in the same residential premises as those they are caring for. Residential premises mean a house or hostel used exclusively for the purpose of providing such accommodation.

    Elderly people are those over 60 years of age; disadvantaged people are those who are intellectually, psychiatrically or physically handicapped, or who are in necessitous circumstances.

    Benefits exempted by this provision may be subject to fringe benefits reporting requirements as explained in Reportable fringe benefits.

    Live-in domestic employees – registered religious institutions

    Accommodation, household fuel, meals and other food and drink provided to an employee may be exempt benefits – however, the employer must be either a registered religious institution or a religious practitioner.

    A religious practitioner is someone who is any of the following:

    • a minister of religion
    • a student at an institution who is undertaking a course of instruction in the duties of a minister of religion
    • a full-time member of a religious order
    • a student at a college conducted solely for training people to become a member of a religious order.

    The employee's duties must be principally the provision of domestic and/or personal services to one or more religious practitioners (and relatives, if any). The performance of those duties must necessitate the employee living in with the practitioner or living in accommodation within the same grounds.

    Domestic services may include child care, gardening, repairs or maintenance to the home, house cleaning, nursing care and the preparation of meals. Personal services may include those of a personal secretary or chauffeur.

    Non-live-in domestic employees

    Food and drink you provide to domestic employees who don't 'live-in' may be exempt benefits – however, the exemption is limited to food and drink consumed by the employee at the place of employment, at or about the time the employee performs the employment-related duties. The employer must be a registered religious institution or a natural person (other than a trustee).

    A domestic employee's duties may include child care, gardening, home renovations, repairs or maintenance to the home, house cleaning, nursing care and the preparation of meals.

    An example of this exemption is a situation where a babysitter cares for children in their own home and shares lunch with them.

      Last modified: 05 May 2017QC 17820