Fringe Benefits Tax (FBT) is a generally misunderstood tax so don't drop the ball on what you might be liable to pay.
The purpose of FBT is to make sure that any benefits "employee's" receive don't escape the tax net. This means that benefits paid to staff (and owners of businesses alike) are levied FBT to effectively put the employee in the same position as if they had paid for the benefit out of their own tax paid income. The difference is that the FBT is generally paid by the employer although in some cases the employer is reimbursed by the employee for the FBT cost.
A taxable benefit can also include benefits provided to staff but provided by third parties.
For example, maybe your business has just done some work for Manu Vatuvei and he gives one of your staff members free tickets to go and see the mighty Warriors. As an employer, you may find you have an FBT liability on the value of those tickets even though in some cases you may not even know about them.
For some good information on these "Left Field" benefits please have a look at our March Newsletter.
The FBT year runs from 1 April to 31 March, so now is a good time to consider how the FBT rules may affect you. Where an employer or other party provides a non-cash benefit (ie. use of a motor vehicle, free tickets to the footy, a low interest loan etc) to an employee (including an owner of the business who is a director) FBT applies to the value of that benefit at the FBT rate of 49%.
If you, or anybody else, provide benefits to your staff or director(s) or provide other fringe benefits then FBT may apply to you and you should give us a call on (07) 5439 1600 to discuss your possible liability. Or CLICK HERE to make an appointment with one of our qualified advisors.