Fringe Benefits tax (FBT)


FBT is paid by employers for the benefits they provide to the employees, family or Other associates. Its employer’s responsibility to self-assess their FBT liability for the year (1 April to 31 March) and submit the FBT return. Employers will be eligible to claim a deduction for the cost of providing benefits and for the FBT they pay.


FBT purpose employees include a


  • Future, present or past employee
  • Director of a company
  • Beneficiary of a trust who works with the business



Examples of FBT


  • providing the employee with a discounted loan
  • employee’s gym membership
  • Employee to use a work car for personal reasons
  • Giving benefits under a salary sacrifice arrangement with an employee




How to reduce FBT?


  • Provide benefits that are tax-deductible
  • Using employee contributions
  • Provide a cash bonus
  • Provide benefits exempt from FBT



Calculating your FBT


  • Step 01 – Work out the taxable value of each benefit provided to employees
  • Step 02 – Work out the values you can claim a GST credit
  • Step 03 – Work out the grossed-up taxable value of the benefits
  • Step 04- Work out the taxable value of benefits which you can’t claim a GST credit
  • Step 05 – Work out the grossed-up taxable value by multiplying the total taxable value Of the benefits that you can’t claim a GST credit
  • Step 06 – Add the grossed-up  amount from steps 03 and 04
  • Step 07 – Multiply the total fringe benefits taxable amount by the FBT rate. This will be the total amount you have to pay.




Registering for FBT


  • Online – Using the ABN registration service
  • Via phone
  • Through registered tax agent
  • Completing the paper form
  • By lodging your annual FBT return


Reporting, lodging and paying FBT



  • Employers required to lodge an FBT return if they have a liability during the FBT year (1 April to 31 March)
  • Due to COIVID 19, the lodging date was deferred in the previous FBT year
  • If registered for FBT but don’t need to lodge a return, can complete the Fringe benefit tax -notice if non-lodgement.



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