What is Fringe Benefit Tax (FBT)

Fringe Benefits are benefits provided by employers to their employees other than ordinary wages and salaries. Some of the most common fringe benefits are listed below

• allowing an employee to use a work car for private purposes

• car parking and tolls

• paying an employee's gym membership

• providing entertainment by way of free tickets to concerts

• reimbursing an expense incurred by an employee, such as school fees

• giving an employee a discounted loan

• giving benefits under a salary sacrifice arrangement with an employee

FBT reporting is essential because it ensures that businesses comply with tax obligations and provide employees with accurate records of fringe benefits.

5 Things you must do if you provide Fringe Benefits to your employees

If you provided Fringe Benefits to your employees, make sure you…

• register for FBT

• calculate how much FBT you must pay

• keep all records relating to the benefits you provide, including how you calculated the FBT you must pay

• lodge a return and pay FBT to the ATO

• include reportable fringe benefits on your employees' payment summary or Single Touch Payroll (STP) income statement

How we can help

At Revis Advisory, we can provide assistance in navigating the complexities of FBT. The FBT tax rate, ranging from 88% to 98%, can be significantly high. However, there are strategies to reduce FBT liability, such as considering employee contributions (i.e., expenses reimbursed by employees) and maintaining accurate records of private use.

Although the FBT process may initially appear daunting due to various considerations and tasks involved, our team at Revis Advisory can provide expert guidance to streamline the process for your convenience.

Should you encounter any challenges or require assistance in managing your FBT obligations, please do not hesitate to contact us. We are here to help.!