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Edited version of private advice
Authorisation Number: 1012625124369
Ruling
Subject: Exempt Fringe Benefits
Issue 1
Question 1
Is an FBT exemption available under Section 58C of the Fringe Benefits Tax Assessment Act 1986 (FBTAA 1986) for the incidental costs associated with the sale and purchase of an employee's home, where notification of the permanent location to one location occurs whilst the employee is undertaking a temporary transfer at another location?
Answers
Scenario 1 A - Yes
Scenario 1 B - Yes
Scenario 2 A - Yes
Scenario 2 B - Yes
Issue 2
Question 1
Would the answer to scenario 1 A, 1 B, 2 A or 2 B be any different if the two year transfer from Location A is within Australia instead of an overseas posting?
Answers
Scenario 1 A - No, the answer would remain the same.
Scenario 1 B - No, the answer would remain the same.
Scenario 2 A - No, the answer would remain the same.
Scenario 2 B - No, the answer would remain the same.
Issue 3
Question 1
Is an FBT exemption available under Section 58C of the Fringe Benefits Tax Assessment Act 1986 (FBTAA 1986) for the incidental costs associated with the sale and purchase of an employee's home, where notification of the permanent location changes from location B to location C?
Answers
Scenario 1 A - Yes
Scenario 1 B - Yes
Scenario 2 A - Yes
Scenario 2 B - Yes
Question 2
Is an FBT exemption available under Section 58C of the Fringe Benefits Tax Assessment Act 1986 (FBTAA 1986) for the incidental costs associated with the sale and purchase of an employee's home, where a subsequent sale is made at location B and a purchase at location C?
Answers
Scenario 1A - Yes
Scenario 1B - Yes
Scenario 2A - Yes
Scenario 2B - Yes
This ruling applies for the following periods:
1 April 2012 - 31 March 2018
The scheme commences on:
1 April 2012
Relevant facts and circumstances
Company employees are regularly transferred both interstate and overseas. Within Australia there are two transfer methods.
1. Transfers to another state or city for periods from 12 months to 2 years, with the option to extend for a further year; and
2. Permanent transfer to another state or city.
International transfers are always considered option 1 and are for a period of two years, with two, one year optional extensions. If an extension is received for an International posting the employee will be notified towards the end of their initial two year posting.
When an employee is domestically or internationally transferred from their usual place of residence to another place on an option 2 transfer, they are entitled to claim the incidental costs incurred in relation to the sale and or purchase of their residential property.
The intention upon cessation of an option 1 posting, whether domestic or international, is that the employee will return to their home office location. However, a member may be required to return to another location where organisational needs dictate.
Relevant legislative provisions
Subsection 136(1) of the FBTAA 1986
Section 58C of the FBTAA 1986
Section 20 of the FBTAA 1986
Section 142A of the FBTAA 1986
Subsection 142A(1) of the FBTAA 1986