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7 Benefits “Outside” FBT Law’s Scope

Knowing what types of benefits “outside” the fringe benefit tax  (FBT) law is an advantage, especially now that another FBT year has started on 1 April 2016.

Listed below are seven specific examples under family arrangements that the ATO deems to be outside FBT Law’s scope, these include:

  1. A birthday gift given to a child who is an employee of the business run by his or her parents;
  2. A wedding present given to an adult child who worked some years after school in the family enterprise;
  3. An interest-free or concessional loan awarded to a child for the purpose of purchasing a matrimonial residence;
  4. The value of the accommodation and meals provided to the children of a primary producer in the family home where they work on the family farm;
  5. The rental value of a farm homestead occupied by a family whose private enterprise conducts farming business in which they work and holds the title to the homestead;
  6. The value of accommodation provided free in the family home to a child who apprenticed to his or her parent as a motor mechanic;
  7. And the administration costs of an employer in providing fringe benefits.

Starting this new FBT year (1 April 2016) small businesses with an aggregated amount of not less than $2 million are now entitled to an FBT exemption when they provide their employees multiple (qualified) work-related portable electronic devices, even where the items have substantially similar functions. The previous FBT exemption was applied to more than one portable electronic device for work purposes, but only where the devices perform substantially different functions. Also, the FBT rate this year is 49% until 31 March 2017, from 47% last FBT year.

If you are unsure if you meet the FBT requirements or need further advice, please contact your client Manager.

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