Fringe Benefit Tax Rules | Judge Accountants Penrith

7 years ago
judge
Accounting

With the legislative changes for FBT implemented as of 1 April 2016, it is important to get familiar with the new regulations. Some modifications have been made to salary sacrificed meal entertainment and entertainment facility leasing expense benefits, which may affect you.

Some of the changes will affect all employers, whereas others will affect non-profit employers as follows.

All employers

Non-profit employers

All salary packaged meal entertainment and entertainment facility leasing expenses are reportable and will be included on an employee’s payment summary where the reporting threshold is exceeded.
The 50-50 split method and 12 week register method will not be able to be used for valuing salary packaged meal entertainment or entertainment facility leasing expenses.

A separate single grossed-up cap of $5,000 will be introduced for salary packaged meal entertainment and entertainment facility leasing expense benefits for employees of employers able to access a general fringe benefit tax exemption or rebate. The amount of those benefits exceeding the separate grossed-up cap of $5,000 is included in calculating whether the value of all benefits an employee receives exceeds their existing FBT exemption or rebate cap.

Other recent FBT changes which may impact you:

From 1 April 2016, employers will no longer be able to calculate otherwise deductible amounts using the 12 per cent of a car’s original value or one third of actual expenses methods.
From 1 April 2016, small business employers with an aggregate annual turnover of less than $2 million can provide their employees with more than one work-related item that will be exempt from FBT, even if the items have substantially identical functions.
The FBT rate has changed for the FBT year starting 1 April 2015 and for subsequent years.

FBT year	FBT rate	Type 1 gross-up rate	Type 2 gross-up rate
Starting 1 April 2015 and 1 April 2016	49%	2.1463	1.9608
Starting 1 April 2017	47%	2.0802	1.8868

The non-profit capping threshold and FBT rebate rate has changed from the year starting 1 April 2015 onwards.

FBT year	PBIs, HPCs, Rebatable employers	Public and non-profit hospitals and public ambulance services	FBT rebate rate
Starting 1 April 2015 and 1 April 2016	$31,177	$17,667	49%
Starting 1 April 2017	$30,000	$17,000	47%