| Disclaimer This edited version has been archived due to the length of time since original publication. It should not be regarded as indicative of the ATO's current views. The law may have changed since original publication, and views in the edited version may also be affected by subsequent precedents and new approaches to the application of the law. You cannot rely on this record in your tax affairs. It is not binding and provides you with no protection (including from any underpaid tax, penalty or interest). In addition, this record is not an authority for the purposes of establishing a reasonably arguable position for you to apply to your own circumstances. For more information on the status of edited versions of private advice and reasons we publish them, see PS LA 2008/4. |
Edited version of your private ruling
Authorisation Number: 1012273501036
This edited version of your ruling will be published in the public register of private binding rulings after 28 days from the issue date of the ruling. The attached private rulings fact sheet has more information.
Please check this edited version to be sure that there are no details remaining that you think may allow you to be identified. If you have any concerns about this ruling you wish to discuss, you will find our contact details in the fact sheet.
Ruling
Subject: Fringe benefits tax; non monetary gifts
Question:
When an employee of the employer is also a board member of a third party company, are gifts they receive as a result of their position on the board of the third party company provided 'in respect of' their employment with the employer in accordance with the meaning of 'in respect of' in subsection 136(1) of the Fringe Benefits Tax Assessment Act 1986?
Answer:
No
This ruling applies for the following fringe benefits tax years:
Year ended 31 March 2008
Year ended 31 March 2009
Year ended 31 March 2010
Year ended 31 March 2011
Year ended 31 March 2012
Year ending 31 March 2013
Year ending 31 March 2014
Year ending 31 March 2015
Relevant facts and circumstances
This ruling is based on the facts stated in the description of the scheme that is set out below. If your circumstances are materially different from these facts, this ruling has no effect and you cannot rely on it. The fact sheet has more information about relying on your private ruling.
It is customary for employees of the employer to receive non monetary gifts from businesses and members of the public to thank them for hard work done on a project or when they attend events as a representative of the employer.
Most non monetary gifts received by employees are from a third party government entity and a third party company.
At least one employee is also a board member of the third party company.
Certain non monetary gifts are provided to the employee as a result of their position on the board of the third party company.
Relevant legislative provisions
Fringe Benefits Tax Assessment Act 1986 subsection 136(1).
Reasons for decision
While these reasons are not part of the private ruling, we provide them to help you to understand how we reached our decision.
Benefits 'in respect of' employment
An employer is generally liable for fringe benefits tax on the taxable value of fringe benefits that are provided to its employees. In accordance with the definition of 'fringe benefit' in subsection 136(1) of the Fringe Benefits Tax Assessment Act 1986 (FBTAA), a benefit is a fringe benefit if it is provided 'in respect of' the employment of the employee.
The definition of 'in respect of' in subsection 136(1) of the FBTAA, in relation to the employment of an employee, includes by reason of, by virtue of, or for or in relation directly or indirectly to that employment.
When employees of the employer receive gifts that are given to them because of their position as a board member of a third party those gifts are not provided in respect of their employment with the employer.