What is Fringe Benefits Tax?
Fringe Benefit Tax (FBT) is a tax levied on non-salary benefits or perks provided by an employer to their employees as a part of their employment package. These fringe benefits can include items such as company cars, health insurance, housing, free or subsidized meals, and other non-cash benefits.
How much FBT do you pay?
For 2022-23 financial year, FBT is payable at 47% of ‘grossed-up’ value of the fringe benefits. “Grossed-up” value is equivalent to the gross income your employees would have to earn, at the highest marginal tax rate (including the Medicare levy), to buy the benefits themselves. Gross up amount is calculated by multiplying the cost of fringe benefits with following Gross Up Rates:
When is FBT due?
FBT return is due for lodgement and payment for each FBT year by 21 May. The FBT year runs from 1 April to 31 March. If previous year’s FBT liability was $3,000 or more, employer is required to pay FBT in quarterly instalments in their BAS’s.
Are you entitled to claim exemptions or concessions?
There are certain exemptions and concessions available for employers regarding Fringe Benefits Tax (FBT). These exemptions and concessions may apply to specific types of fringe benefits, certain types of employers, or specific circumstances.
Some of the common FBT exemptions and concessions include:
It is important to note that the eligibility and conditions for these exemptions and concessions may vary, and employers should seek professional advice to determine their FBT obligations and entitlements.
Get in touch with us today if you have any questions or need any help in determining your FBT obligations and entitlements.
Disclaimer: This article is provided as general information only and does not consider your specific situation, objectives, or needs. It does not represent accounting or tax advice upon which any person may act. Implementation and suitability require a detailed analysis of your specific circumstances. Before taking any action, consider your own circumstances and seek professional advice.