The employer is responsible for paying FBT, and it is based on the taxable value of the fringe benefits provided to employees and their associates.
If the employer provides only salary and wages to employees, no FBT will be applicable.
Businesses that provide fringe benefits to employees must lodge an annual Fringe Benefits Tax Return. The FBT year runs from 1 April of the previous year to 31 March of the current year, with lodgements and payments for the 2024 year having a due date of 21 May 2024, or 25 June 2024 if lodging through a tax agent.
Following lodgement, employers may also be required to make quarterly FBT instalments as part of their Business Activity Statement (BAS) reporting.
There are various fringe benefits that could be provided to employees, some of the most common benefits are outlined below:
There are several exemptions and concessions available for certain types of fringe benefits. These exemptions and concessions include:
One of the most common fringe benefits we see is providing a car to an employee for their private use. The taxable value of a car fringe benefit is based on a number of factors, including the cost of the car, the type of car, the date it was acquired, and the logbook business use percentage of the vehicle.
There are several methods that can be used to calculate the taxable value of a car fringe benefit, including the statutory formula method and the operating cost method. Employers should be aware of the rules and requirements surrounding car fringe benefits to ensure compliance with FBT obligations. You can find details about Car Fringe Benefits here.
FBT can be a complex tax that requires careful attention from employers to ensure compliance. By understanding the basics of FBT and taking advantage of exemptions and concessions where possible, you can reduce the amount of FBT that you are required to pay.
For assistance with your FBT obligations or to have your questions answered about any tax obligations, feel free to talk with us. Our team at BLG Business Advisers are Wollongong Accountants who service right around Australia and are here to help you.