Yes that’s right, it’s Fringe Benefits Tax time again! *Like our tax system isn't complicated enough already*
Today (the 31st) marks the end of the FBT Year. Yes, that's right it's a completely different year for fringe benefits tax than it is for your normal income tax.
So what does that mean to business owners? Most businesses that have Employees (that includes yourself) will be caught in the Fringe Benefits Tax System.
If you provide your employees with a benefit other than Salary/Wages/Bonuses/Super then you are likely to be providing Fringe Benefits to your employees. Now just to make things interesting some benefits you provide employees will attract an actual tax whilst others will be exempt. The bad news is that even if you don’t have to actually pay any tax on these benefits you still have to prepare that dreaded return & keep all the necessary records to prove your exemptions.
What do we mean by a benefit other than Salary?
If you provide your employees (including yourselves) with any of the following you will be providing a Fringe Benefit to your employees and will be required to complete a return:
- provide them with a car
- provide them with a mobile phone
- have a work xmas party
- provide things like a corporate box at a sporting event?
- provide employees with lunch / dinner / alcohol (like Friday afternoon drinks)?
- provide employees with car paring?
- provide employees with loans?
- give gifts to your employees.
Basically if you provide your employees with a benefit other than Salary/Wages/Bonuses/Super then you are likely to be providing Fringe Benefits to your employees. While there are some exemptions and thresholds before you have to pay tax on these benefits, you are still required to lodge the return and keep the records.
Don't stress though! We will take care of the Return and the lovely paperwork.
So what records do I have to keep?
Some examples include maintaining a log book for your vehicles, declarations of private use for Mobile Phones etc and actual Entertainment Benefit Records.
For all our Growthwise clients look out for another email today requesting your odometer reading :)
