Fringe Benefits Tax (FBT) is a tax payable by employers for benefits paid to an employee (or an employee's associate e.g. a family member) in place of salary or wages. This is separate to income tax and is calculated on the taxable value of the fringe benefits provided. Trade businesses in particular usually have vehicles or other assets that are used by employees for private purposes. It is important for business owners to identify this usage and report to the Australian Taxation Office (ATO). We will prepare your FBT returns for you and lodge them with the ATO.
The main assets or activities that attract FBT:
- Cars, Vans, Utes and other vehicles provided to employees that are garaged off site
- Car parks that are provided to employees
- Tickets to sporting events and other entertainment activities
- Payment of employee's private expenses
What do you need to do about FBT as a business owner?
It is necessary to keep records of all fringe benefits provided to employees and associates. Some of the fringe benefits provided need to be reported on your employees' payment summaries. The taxable value of fringe benefits needs to be worked out and FBT is to be paid on grossed up value of the fringe benefits provided.
After 31 March 2019 our clients will receive FBT questionnaires to establish what benefits your business is providing and the value of the benefits provided. If you are unsure on how to complete these forms, contact one of our accountants and we will help you with the process. Have the forms back to us no later than the 30th of April. We will work out your liability and lodge your FBT returns with the ATO.
This might be a lot of information to try and absorb and understand on your own. If you are not a client of Tradies Accountant, we recommend that you speak to your accountant well before the end of the FBT reporting season, so that you can have your FBT returns lodged with the ATO on time . If you would like some help from us, our accounting team is more than happy to be of service so please, book a consultation.