Will you be affected by these Fringe Benefit Tax changes?
As the current Fringe Benefit Tax (FBT) year ended on 31 March 2016 and a new one began on 1 April 2016, a number of changes have occurred to salary packaged meal and other entertainment benefits that you should be aware of, including:
- Changes for employees
There have been changes to the FBT treatment of salary packaged meal entertainment and entertainment facility leasing expense benefits (meal and other entertainment benefits). Some of the changes will affect all employees, while others will affect employees of not-for-profit organisations.
The following applies to all employees:
- All salary packaged meal and other entertainment benefits are reportable and will be included on the payment summary where the reporting exclusion threshold is exceeded; and
- The 50-50 split method and 12-week register method cannot be used by the employer for valuing salary packaged meal and other entertainment benefits which may affect how much an employee can salary packagw.
2. Specific changes for Not-for-profit employees
For employees who work for a not-for-profit employer:
- A separate single grossed-up cap of $5,000 will apply for salary packaged meal and other entertainment benefits for employees of not-for-profit organisations able to access a general FBT exemption or rebate ($31,177 or $17,667 exemption; or $31,177 rebate); and
- The amount of those benefits exceeding the separate grossed-up cap of $5,000 are included in calculating whether the value of all benefits an employee receives exceeds the general FBT exemption or rebate cap.
This means that from 1 April 2016 employees can receive such benefits worth between $2,329.59 and $2,549.98 (depending on whether the employer is entitled to GST credits) without exceeding the $5,000 cap.
Other FBT updates:
- FBT implications over the Festive Season
The ATO reminded employers over the Festive Season that entertainment provided to their employees during this season, or at any other time of the year, should remember to think about the following:
- When providing food, drink or recreation may be considered ‘entertainment’;
- Whether the entertainment is subject to fringe benefits tax (FBT); and
- The methods available for valuing entertainment fringe benefits.
Depending on the sort of entertainment that your employer provided to you as an employee, there may be different FBT implications which may need to be included in your 2015-16 Payment Summary.
Talk to your tax adviser about the entertainment you may have received from your employer over the Festive Season. Did you have a Christmas party? Did you receive a gift from your employer? Contact us if you are concerned with how this might impact your 2015-16 tax return.
2. FBT exemptions for work-related electronic devices
From 1 April 2016, Small Business employers (with turnover of less than $2 million) will be able to provide employees with multiple electronic devices to use for work without incurring a fringe benefits tax (FBT) liability.
Employers can provide to employees:
- mobile phones
- tablets
- laptops
- calculators
- GPS navigation receivers.
If you need more than one device for work, talk to your employer about having them provided to you.
Note that providing these devices may be a benefit in addition to or part of your salary or wages package.
If you are planning on requesting multiple devices from your employer, contact your local Mas Tax office to find out how the FBT rules may impact this.
You need advice, contact us below or call 1300 627 829.
