FBT Changes 2015

FRINGE BENEFITS TAX ON ALL PORTABLE WORK DEVICES ABOLISHED

Small businesses that supply their employees with portable devices, such as laptop computers and tablets, will no longer need to pay Fringe Benefits Tax (FBT) on these types of devices. Previously, businesses were limited to claiming an FBT exemption on only one of these devices because a laptop and a tablet were considered to have ‘substantially identical functions’.

The exemption will apply from April 1, 2016 to small businesses and start-ups with an aggregated annual turnover of less than $2 million.

CAPPING THRESHOLD FOR SALARY SACRIFICED MEAL ENTERTAINMENT AND ENTERTAINMENT FACILITY LEASING EXPENSES (‘EFLES’)

Currently certain employers are capped on the amount of concessionally taxed fringe benefits they can provide to their employees, as follows:

  1. FBT-Rebatable Employers (e.g. certain associations, clubs or societies,) are subject to a $30,000 cap (increased to $31,177 for the 2016 and 2017 FBT years due to the Temporary Budget Repair Levy) on the amount of fringe benefits (which are eligible for an FBT rebate) they can provide to each of their employees.
  2. Public Benevolent Institutions and Health Promotion Charities are subject to a $30,000 cap (increased to $31,177 for the 2016 and 2017 FBT years) on the amount of FBT-exempt benefits they can provide to each of their employees.
  3. Public and Non-Profit Hospitals and Ambulance Services are subject to a $17,000 cap (increased to $17,667 for the 2016 and 2017 FBT years) on the amount of FBT-exempt benefits they can provide to each of their employees.

Certain benefits are currently excluded from these caps, such as the following:

  • Meal entertainment-related benefits (e.g. restaurant meals) and
  • EFLEs (e.g. holiday accommodation and venue hire for a special event, such as a wedding).

Additionally, meal entertainment-related benefits and EFLEs are also currently excluded from the FBT payment summary reporting rules.

From 1 April 2016, the government will introduce a separate single grossed-up cap of $5,000 for salary sacrificed meal entertainment and EFLEs. Where these benefits exceed the separate grossed-up cap of $5,000 they can also be counted in calculating whether an employee exceeds their existing (relevant) cap. In addition, all meal entertainment benefits will become reportable.


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