1.

9 FBT
Does FBT apply?

Exclusions
1) Specific s136(1) salary,ETP,deemed div, compo for personal injury of capital
nature, employee share schemes, employer superfund contributions
2) Specific Div 13
3) Div 14 reductions s62 allows $500 reduction for all in-house benefits and airline
FB; s63A allows taxable value for entertainment FB where not provided to employee
Div 13 exclusions
> Section 58A employment interviews and selection tests
> Section 58B relocation: removals and storage of household effects
> Section 58C incidental costs on sale or acquisition of a dwelling
> Section 58D relocation: connection or reconnection of certain utilities
> Section 58E leasing of household goods while living away from home
> Section 58F relocation transport
> Section 58H newspapers and periodicals used for business purposes
> Section 58J compensable work-related trauma
> Section 58K in-house health care
> Section 58M work-related medical exp, counselling, migrant training
> Section 58P minor benefits < A$100
> Section 58X provision of certain work-related items:
mobile or car phone (s58X(2) exemption if primarily for business use s58X(3))
notebook or laptop computer (exemption s58X(2) and only for the first laptop
provided in the FBT year s58X(4))
protective clothing required by employer
briefcase
calculator
tools of trade
computer software for business use
electronic diary
personal digital assistants and portable printers for laptops
> Section 58Y membership and subscription fees for:
trade or professional journals
entitlement to use a corporate credit card
entitlement to use an airport lounge membership
> Section 58Z taxi travel between home and work is exempt from FBT (if taken
in a single trip that begins or ends at work)

Car FBT

Car is held available for private use

Not exempt:
1) Taxi, panel van, utility truck (<1tonne) with
private use limited to a) employee work-related
travel, b) minor, infrequent and irregular use
2) Unregistered car principally for business

Statutory formula vs
Operating Cost
*if car is >4yrs old at beginning
of FBT, take 2/3 of the value

Debt Waiver s15

TV = amt of pmt or
re-pmt waived

LAFHA s30
TV=total amt
reasonable compo for
accomo reasonable
compo for increased
food expenditure s31

Select method
yielding lower
FBT s10(5)

FBT interaction with income tax & GST

Loan FB s16 (7.3%)

TV = Interest accrued +
diff btwn stat interest
*subject to s19 otherwise
deductible rule (only for
once off deduction)

Meal entertainment Div 9A

If NO election
per head basis where
employee proportion is FBT s32-30
1) 50/50 method s37BA, 2) 12
Election
week register method (valid for nxt 4 yrs, unless
actual expense is 20% higher than register yr
*same method applied to income tax

Other info
- Salary packaging
effective
when providing exempt FB
-s23L excludes fringe benefits
from ITAA, and s26(e) has the
same effect.
- FBT deductible under s8-1
*Otherwise deductible rule
DOES NOT apply to associates

Gross-up
Type I
2.0647
Type II
1.8692

Expense payment FB s20

1) Employee pays first & gets reimbursement
-s51AH denies deduction to employees for
reimbursed amts
2) Employer pays 3rd party directly
TV = FV (generally, depends on inhouse v
external)
- subject to s24 otherwise deductible rule
(only for once off deduction)
Entertainment facility leasing s152B
TV=50% total expenses
-incl corporate box, boats, planes, other
premises
-does NOT incl food and drink, advertising

Residual FB s45
TV determined by table below if in-house
FB, external is arms length cost (s50-51)
- In-house subject to $500 reduction (s62)
- reduced by recipients contribution; s52
otherwise deductible rule (only for once
off deduction)

Reportable fringe benefits

-if FB >$1000 for an employee,
grossed up at 1.8692
- incl in payment summary, not
taxed, but used to determine
entitlements such as family
allowance, surcharges etc

Property FB s40
Employer provides property free or discount, s136 def incl
tangible & intangible goods, real property, choses in action
(shares, bonds etc)
TV determined by table below if in-house FB, external is arms
length cost (s43)
- In-house subject to $500 reduction (s62)
- TV reduced by recipients contribution;
-s44 otherwise deductible rule (only for once off deduction)
-exemption applies to property provided on working days at
employers premises s41

Manufacturer
Retailer

Ken Choi 2007