Global Employer Services FBT update for the year ending 31 March 2016

Transcription

1 Global Employer Services FBT update for the year ending 31 March April March 2016 FBT rates and thresholds Description Rate/threshold FBT rate on grossed up value of benefit 49% Gross-up factor Type 1 benefits for which employer can claim input tax credit for GST Gross-up factor Type 2 benefits for which employer cannot claim input tax credit for GST Reportable fringe benefits threshold (benefits are not reportable unless the cap has been exceeded) $2,000 taxable value/ $3,921 grossed-up taxable value FBT benchmark interest rate for the year ending 31 March % Car parking threshold for the year ending 31 March 2016 $8.37 per day Minor benefits threshold Less than $300 Safety awards threshold $200 In-house benefits concession $1,000 Car fringe benefits statutory formula percentage (except for cars acquired under pre-existing financial commitments as at 10 May 2011) 20% Non-remote housing indexation figures (refer to TD 2015/4) State Indexation figure NSW VIC QLD SA WA TAS NT ACT Page 1 of 5

2 Motor vehicle (other than a car) cents per kilometre rate (refer to TD 2015/6) Engine capacity cc Over 2500cc Motor cycles Rate per kilometre 51 cents 61 cents 15 cents Deemed depreciation rate for cars Date car purchased Depreciation rates On or before 30 June % 1 July 2002 to 9 May % On or after 10 May % Reasonable food allowance within Australia rates (refer to TD 2015/7) (Maximum amounts that do not require substantiation by employee) Family size Reasonable food allowance per week 1 Adult $241 2 Adults $362 3 Adults $483 1 Adult, 1 Child $302 2 Adults, 1 Child $423 2 Adults, 2 Children $484 2 Adults, 3 Children $545 3 Adults, 1 Child $544 3 Adults, 2 Children $605 4 Adults $604 Additional Adults $121 Additional Children $61 Page 2 of 5

3 Taxation Determination The following FBT related Taxation Determinations have been issued: Fringe benefits tax TD 2015/4: For the purposes of section 28 of the Fringe Benefits Tax Assessment Act 1986 what are the indexation factors for valuing non remote housing for the fringe benefits tax year commencing on 1 April 2015? Fringe benefits tax TD 2015/5: For the purposes of section 135C of the Fringe Benefits Tax Assessment Act 1986, what is the exemption threshold for the fringe benefits tax year commencing on 1 April 2015? Fringe benefits tax TD 2015/6: What are the rates to be applied on a cents per kilometre basis for calculating the taxable value of a fringe benefit arising from the private use of a motor vehicle other than a car for the fringe benefits tax year commencing on 1 April 2015? Fringe benefits tax TD 2015/7: Reasonable amounts under section 31G of the Fringe Benefits Tax Assessment Act 1986 for food and drink expenses incurred by employees receiving a living-away-from-home allowance fringe benefit, for the fringe benefits tax year commencing on 1 April Fringe benefits tax TD 2015/8: What is the benchmark interest rate to be used for the fringe benefits tax year commencing on 1 April 2015? Fringe benefits tax TD 2015/11: For the purposes of section 39A of the Fringe Benefits Tax Assessment Act 1986 what is the car parking threshold for the fringe benefits tax year commencing on 1 April Taxation Determination TD 2015/12: Fringe benefits tax: When are the duties of the employment of an employee of an employer who is a government body exclusively performed in, or in connection with, a public hospital or a hospital carried on by a society or association that is a rebateable employer? Taxation Ruling No FBT related Taxation Rulings have been issued. Class Ruling The following FBT related Class Rulings have been issued: CR 2015/1 Income tax and fringe benefits tax: customers of Fleet Partners Pty Ltd who use the FleetPartners Vehicle Log Book (Privacy Protected) report for their log book records CR 2015/2 Fringe benefits tax: Clients of LogbookMe Pty Ltd who use the LogbookMe In-Car Logbook Solution to calculate the total number of car parking benefits CR 2015/9 Fringe benefits tax: Health and fitness equipment services provided by EFM Corporate Pty Ltd CR 2015/60 Income tax and fringe benefits tax: Customers of GPSI Group Pty Ltd who use the GPSI 'Vehicle Logbook Report' for their log book records CR 2015/80 Fringe benefits tax: Use of an E-stralian electric bicycle (e-bike) by an employee CR 2015/105 Fringe benefits tax: Employers who use the Telogis GPS system for car log book records and for odometer records CR 2015/106 Income tax and fringe benefits tax: Use of the Mobilyser app report to calculate an income tax deduction or fringe benefits tax liability CR 2015/111 Fringe benefits tax: Corporate clients of McMillan Shakespeare Limited and its subsidiaries (McMillan Shakespeare) who participate in McMillan Shakespeare's bus travel benefit scheme Page 3 of 5

4 ATO Interpretative Decision The following FBT ATO Interpretative Decision has been issued: ATO ID 2015/1 Fringe Benefits Tax Exempt benefits: work-related counselling training courses or activities for employees being made redundant ATO ID 2015/25: Fringe Benefits Tax: Exempt residual benefits the provision, or use, of a recreational facility The following FBT ATO Interpretative Decisions have been withdrawn: ATO ID 2002/614: Fringe Benefits Tax: Expense payment fringe benefit payments made to a home mortgage offset facility account. ATO ID 2003/1: Fringe Benefits Tax: In-house residual fringe benefit investment related service ATO ID 2003/40: Fringe benefits tax: Exempt benefits duties of employee relating to a public hospital. ATO ID 2008/20: Reportable fringe benefits: Pooled or shared cars use of a motor vehicle that is not a car. ATO ID 2010/182: Fringe benefits tax: Exempt benefits remote area housing benefits salary sacrifice arrangement. Practice Statement Law Administration There were no FBT related Practice Statements issued. Taxpayer Alert There were no FBT ATO Taxpayer Alerts issued. Legislation update Changes in FBT rates (due to Budget Repair Levy) Legislation has been enacted to increase the FBT rate to 49% from 1 April The Type 1 gross-up factor has increased to The Type 2 gross-up factor has increased to For the purpose of reporting fringe benefits on employee payment summaries, where the taxable value of the aggregate fringe benefits of an employee exceeds $2,000, it will be grossed-up by the new Type 2 factor of , from 1 April (These changes have arisen as a result of the increase of the Budget Repair Levy on 1 July 2015.) FBT meal and entertainment concessions for Not-For-Profit (NFP) employees to be capped As part of the 2015 Federal Budget, the Government announced that a limit would be placed on the amount of FBT exempt, salary sacrificed meal entertainment and entertainment facility leasing expenses that could be provided by certain charity and not-for-profit (NFI) organisations (i.e. public and not-for-profit hospitals, public ambulance services, public benevolent institutions (except hospitals) and health promotion charities). The measure will apply from 1 April 2016 so that employees of these types of organisations can only receive up to $5,000 (grossed-up value) of salary sacrificed meal entertainment or entertainment facility leasing that will be treated as tax exempt for FBT purposes. The $5,000 cap is a separate cap from the existing FBT caps which are (from 1 April2015) $17,667 for public and not-for-profit hospitals and public ambulance services and $31,177 for public benevolent institutions and health promotion charities All salary sacrificed meal entertainment benefits will also become reportable benefits and thus will count towards an employee's "reportable fringe benefits amount" for an income year. These measures will apply from 1 April Page 4 of 5

5 Case law update John Holland Group Pty Ltd v Commissioner of Taxation [2015] FCAFC 82 (11 June 2015) The Full Federal Court has unanimously allowed the taxpayer s appeal from a decision at first instance in the Federal Court relating to the FBT taxable value of flights paid for by the taxpayer and taken by the taxpayer s employees for travel between Perth and Geraldton under certain fly-in fly-out arrangements. The Full Federal Court had held that costs incurred by John Holland Group companies in flying employees from Perth to Geraldton and back for a rail upgrade construction project would have been deductible to the employees, meaning the companies could reduce their FBT liability on the flight costs to nil. Between May 2011 and September 2012, the employees of the companies worked on the rail upgrade project. The companies paid for their respective employees to be flown from Perth to Geraldton, near where the Project was located, and back again on a rostered basis. Employees travelled to Perth airport at their own expense, but Perth airport was designated in the John Holland rail documents as the point of hire. Under general income tax principles, home to work travel is treated as private in nature and non-deductible. In this instance the taxpayer argued that the travel between an employee s home and Perth was home to work but the costs of travel from Perth to Geraldton were not. The taxpayer considered those costs to be deductible. The Commissioner disagreed and the matter came on appeal before the Federal Court. The Federal Court found in favour of the Commissioner but on further appeal, the Full Federal Court found in favour of the taxpayer. Pagone J, who gave the main judgment, said the time spent in travelling from Perth airport to Geraldton was part of an employee s employment for which he or she received wages and was entitled to an additional allowance if the period exceeded that provided for. ATO products update Fringe benefits tax a guide for employers This publication has been updated for the residual fringe benefits chapter. Calculators The FBT car and FBT PBI calculators have been updated for the FBT year. About Deloitte Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee, and its network of member firms, each of which is a legally separate and independent entity. Please see for a detailed description of the legal structure of Deloitte Touche Tohmatsu Limited and its member firms. Deloitte provides audit, tax, consulting, and financial advisory services to public and private clients spanning multiple industries. With a globally connected network of member firms in more than 150 countries, Deloitte brings world class capabilities and high quality service to clients, delivering the insights they need to address their most complex business challenges. Deloitte has in the region of 225,000 professionals, all committed to becoming the standard of excellence. About Deloitte Australia In Australia, the member firm is the Australian partnership of Deloitte Touche Tohmatsu. As one of Australia s leading professional services firms, Deloitte Touche Tohmatsu and its affiliates provide audit, tax, consulting, and financial advisory services through approximately 6,000 people across the country. Focused on the creation of value and growth, and known as an employer of choice for innovative human resources programs, we are dedicated to helping our clients and our people excel. For more information, please visit Deloitte s web site at Liability limited by a scheme approved under Professional Standards Legislation. Member of Deloitte Touche Tohmatsu Limited 2016 Deloitte Tax Services Pty Ltd Page 5 of 5