FBT Changes 2015
FRINGE BENEFITS TAX ON ALL PORTABLE WORK DEVICES ABOLISHED
Small businesses that supply their employees with portable devices including laptop computers and tablets will no longer need to pay Fringe Benefits Tax (FBT) on either device. Previously, businesses may not have been able to obtain an FBT exemption on such devices because a laptop and a tablet could be 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 that provide employees with more than one qualifying work-related portable electronic device, where the devices have similar functions.
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:
- 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.
- 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.
- 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 (meal entertainment benefits). 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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