If your employer clients are offering, or thinking about offering, their staff benefits on top of salary and wages, they’ll have to consider the possible fringe benefits tax (FBT) implications. There’s nothing wrong with offering those kinds of benefits but they could attract an FBT liability.
For example, do they know that everything in the list below could incur FBT?
- allowing an employee to use a work car, including a dual cab ute, for private purposes
- car parking
- gym memberships
- tickets to concerts, shows or sports events
- reimbursed school fees
- discounted loans
- salary sacrifice arrangements with staff.
If your client is providing their employees the kinds of benefits that attract FBT, there are four key steps you can take them through:
- Identify the types of fringe benefits provided.
- Determine the taxable value using the right valuation method relevant to each fringe benefit.
- Lodge an FBT return by the due date.
- Keep records that demonstrate calculations and support their FBT position.
We want to help you help your clients understand that FBT is a key employer obligation. That all starts with them knowing how FBT works.If your clients provide benefits to their staff on top of salary and wages, inform them of the FBT implications.