ATO Interpretative Decision
ATO ID 2006/333
Fringe Benefits Tax
Exempt Benefits: meals on working days - benefit consisting of a meal that is ready for consumptionFOI status: may be released
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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you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed.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
Where an employee is provided with uncooked meat and vegetables on a working day, has a benefit been provided that consists of 'a meal that is ready for consumption' in accordance with paragraph 58ZD(c) of the Fringe Benefits Tax Assessment Act 1986 (FBTAA)?
Decision
No. Food provided to an employee on a working day, which requires the employee to prepare in order to be eaten, is not considered to be a benefit consisting of a meal that is ready for consumption pursuant to paragraph 58ZD(c) of the FBTAA.
Facts
The employer carries on a business of primary production in a remote area.
The employer provides their employee with free meat and vegetables on a working day. However the employee is required to prepare the food for it to be eaten.
The circumstance under which the food is supplied does not amount to meal entertainment for the purposes of section 37AD of the FBTAA.
Reasons for Decision
Section 58ZD of the FBTAA exempts from fringe benefits tax certain benefits consisting of a meal provided by employers carrying on the business of primary production. Each of the conditions as specified in section 58ZD of the FBTAA must be met before the benefit can be an exempt benefit.
Paragraph 58ZD(c) of the FBTAA requires that the benefit provided to an employee on a working day consists of a meal that is ready for consumption.
The explanatory memorandum to the A New Tax System (Fringe Benefits) Bill 2000 that introduced section 58ZD of the FBTAA does not define what is meant by 'meals' and 'ready'. As such they would be interpreted on the basis of their ordinary meaning.
Meal is defined in the Macquarie Dictionary, [Multimedia], version 5.0.0, 1/10/01 as:
- 1.
- one of the regular repasts of the day, as breakfast, lunch, or dinner.
- 2.
- the food eaten or served for a repast.
Ready is also defined in the Macquarie Dictionary, [Multimedia], version 5.0.0, 1/10/01 as:
- 1.
- completely prepared or in due condition for immediate action or use: troops ready for battle; dinner is ready.
The food which has been provided to the employee does not consist in its raw form, of a meal that is completely prepared for immediate use. Accordingly such food is not considered to be a benefit consisting of a meal that is ready for consumption pursuant to paragraph 58ZD(c) of the FBTAA.
Amendment History
| Date of Amendment | Part | Comment |
|---|---|---|
| 31 March 2017 | Decision | Minor punctuation amendment |
| Facts | Minor punctuation amendments | |
| Reasons for decision | Minor punctuation amendments |
Year of income: Year ended 31 March 2007
Legislative References:
Fringe Benefits Tax Assessment Act 1986
section 58ZD
paragraph 58ZD(c)
ATO ID 2005/109
Other References:
The Macquarie Dictionary, [Multimedia], version 5.0.0, 1/10/01.
A New Tax System (Fringe Benefits) Bill 2000
Keywords
Exempt benefits
Fringe benefits tax
Date reviewed: 26 April 2017
ISSN: 1445-2782
| Date: | Version: | |
| 14 November 2006 | Original statement | |
| You are here | 31 March 2017 | Updated statement |
| 7 August 2026 | Updated statement |