Fringe benefits tax: what is the benchmark interest rate to be used for the fringe benefits tax (FBT) year commencing 1 April 1996?
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FOI status:may be releasedFOI number: I 1014944
|This Determination, to the extent that it is capable of being a 'public ruling' in terms of Part IVAAA of the Taxation Administration Act 1953 , is a public ruling for the purposes of that Part. Taxation Ruling TR 92/1 explains when a Determination is a public ruling and how it is binding on the Commissioner. Unless otherwise stated, this Determination applies to years commencing both before and after its date of issue. However, this Determination does not apply to taxpayers to the extent that it conflicts with the terms of a settlement of a dispute agreed to before the date of issue of the Determination (see paragraphs 21 and 22 of Taxation Ruling TR 92/20).|
- a fringe benefit provided by way of a loan;
- a car fringe benefit where an employer chooses to value the benefit using the operating cost method.
Example On 1 April 1996 an employer lends an employee $60,000 for five years at an interest rate of 6% per annum. Interest is charged and paid 6 monthly and no principal is repaid until the end of the loan. The actual interest payable by the employee for both the past year and the current year is $3600 (60,000 x 6%). In the current year, with a benchmark interest rate of 10.50% per annum, the taxable value is $2700 [(60,000 x 10.50%) - $3600].
Commissioner of Taxation
1 May 1996
NO NAT 96/2491-1; FBT 155
benchmark interest rate;
car fringe benefit;
fringe benefits tax;
loan fringe benefit
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