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Fringe Benefits Tax – Am I Liable? Posted on October 9, 2018
However, employers can generally claim an income tax deduction for the cost of providing FBT and for the FBT they pay.
Failure to lodge or declare any FBT amounts owed to the Australian Tax Office can incur harsh penalties and are subject to fines and interest charges.
Are you providing Fringe Benefits?
If you answer yes to any of the following questions you may be providing a fringe benefit, and be liable for FBT:
– Have you allowed an employee to use a work car for private purposes?
– Have you given your employee a cheap loan?
– Have you provided an employee with a house or other accomodation?
– Have you paid for an expense incurred by an employee, such as school fees?
– Have you provided your employee with entertainment through food, drink or recreation?
What do I need to do if I am providing a Fringe Benefit?
– Calculate how much FBT you have to pay – you must self-assess your own FBT liability each FBT year.
– Keep the necessary FBT records – the FBT law requires you to keep records in relation to the fringe benefits you provide.
– Register for FBT – we recommend you register once you establish you have to pay FBT.
– Report fringe benefits on your employees’ payment summaries and your FBT return.
What Benefits are subject to FBT?
Benefits that are subject to Fringe Benefits Tax can include:
– – Rights
Fringe Benefits Tax is split into various categories and specific valuation rules apply to each category. This can often make FBT very difficult to calculate for many businesses.
However, it is worth considering which method will be best for your current business situation to help minimise the FBT liability owed.
To find out more about how your business may be subject to Fringe Benefits Tax, click here to contact us for further information.