ATO Interpretative Decision
ATO ID 2001/298 (Withdrawn)
Fringe Benefits Tax
Fringe Benefits Tax : Status of a Public Benevolent Institution Health Care Provider for Fringe Benefits Tax (FBT) purposes.FOI status: may be released
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This ATO ID has been withdrawn because PSLA 2001/9 on which this Decision was based, only applies in relation to the FBT Transitional Allowance Scheme which ceased on 31 March 2003This document incorporates revisions made since original publication. View its history and amending notices, if applicable.
This ATOID provides you with the following level of protection:
If you reasonably apply this decision in good faith to your own circumstances (which are not materially different from those described in the decision), and the decision is later found to be incorrect you will not be liable to pay any penalty or interest. However, you will be required to pay any underpaid tax (or repay any over-claimed credit, grant or benefit), provided the time limits under the law allow it. If you do intend to apply this decision to your own circumstances, you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed. You may wish to obtain further advice from the Tax Office or from a professional adviser.
Issue
Whether the employer which is a Public Benevolent Institution (PBI) but also provides a range of health services including acute and aged care facilities is entitled to an exemption cap of $30,000 grossed up taxable value per employee per annum as from 1 April 2001.
Decision
No. The employer is considered to be a hospital for the purposes of paragraph 57A(2)(b) of the Fringe Benefits Tax Assessment Act 1986 (FBTAA). The employer is therefore entitled to an exemption cap of only $17,000 grossed up taxable value per employee per annum as from 1 April 2000 as outlined in step 2 of subsection 5B(1E) of the FBTAA.
Facts
The employer is member of a health care group in regional Australia, and provides a range of services, including hospitals and aged care facilities.
Reasons for Decision
The ATO position on this issue is outlined in Practice Statement PS 2001/9. Where an employer is a hospital as per the definition outlined in that practice statement, the previously available exemption for FBT is limited to a cap of $17,000 grossed up taxable value per employee as from 1 April 2000. If the employer does not meet the definition of a hospital, and has public benevolent institution status, the previously available exemption for FBT is limited to a cap of $30,000 grossed up taxable value per employee per annum from 1 April 2001.
By examining a range of indicators, including the level of income received for acute care, the number of beds allocated for acute care, the expenditure allocated to the provision of acute care, and various other facts and factors, it was concluded that the employer satisfied the definition of a hospital as outlined in Practice Statement PS 2001/9. Therefore the exemption capping entitlement is only limited to $17,000 grossed up taxable value per employee per annum as from 1 April 2000.
Date of decision: 22 May 2001
Legislative References:
Fringe Benefits Tax Assessment Act 1986
Subsection 5B(1E)
Paragraph 57A(2)(b)
Other References:
Practice Statement PS LA 2001/9
Keywords
Fringe benefits tax
Public benevolent institutions
Hospitals
Public hospitals
FBT Public Benevolent Institutions
Acute care
ISSN: 1445-2782
| Date: | Version: | |
| 22 May 2001 | Original statement | |
| You are here | 18 March 2005 | Archived |