Business Accountants
FBT is a tax applied to certain benefits that employers provide to their employees or their employees’ associates (such as family members) in addition to their salary or wages. Employers are responsible for paying FBT on the benefits they offer employees.
Employers are required to pay FBT on the taxable value of fringe benefits, which is usually based on the cost of providing the benefit. The FBT rate is generally the same as the top marginal tax rate for individuals, which may change each year. The FBT year is 1 April – 31 March and at the time of publication the FBT rate is 47%.
A current, future or past employee
A Company Director
Beneficiary of a trust who works in the business
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Some items are exempt from fringe benefits tax if they are primarily used for work purposes. These include:
Portable electronic devices
Computer software
Protective clothing
Briefcases
Tools of trade
Employers or entities providing fringe benefits to their employees or associates are generally required to pay FBT. This includes companies, partnerships, trusts, and non-profit organisations.
Fringe benefits include non-cash perks provided to employees or associates, such as company cars, health insurance, housing, low-interest loans, and other non-monetary benefits
Not all fringe benefits are subject to FBT. Some exemptions and concessions apply, and certain benefits may be exempt if provided in specific circumstances. Common exemptions include work-related items, certain small business benefits, and specific employee contributions.
Employers report FBT on the Business Activity Statement (BAS) or an FBT return form. The Australian Taxation Office (ATO) provides detailed instructions and guidelines for reporting.
Non-compliance with FBT regulations may result in penalties and interest charges. Employers are encouraged to stay informed about FBT rules and seek professional support to ensure compliance.
*Retinue’s (ABN 66 658 618 449) payroll service includes the processing of hours and wages rates provided by you. We do not determine award rates for your employees or provide advice on the correct employment status of your employees. It is your responsibility to ensure that your employees are paid correctly and we recommend obtaining advice from specialised employment relations experts.
Protection is only provided for ATO investigations notified to us during the period which you are a client and relating to any tax returns or lodgements prepared by us. Fines includes any penalties and interest that may result from any errors made by us but does not include any additional tax liability that may result from an amended lodgement.
Liability limited by a scheme approved under Professional Standards Legislation.
