FBT Newsletter. Fringe Benefits Tax What you need to know

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Monica Mathews
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1 FBT Newsletter Suite 40, Victoria Park Estate, 8 Victoria Ave, Castle Hill NSW 2154 PO Box 6004 Baulkham Hills Business Centre Baulkham Hills NSW 2153 Australia Fringe Benefits Tax What you need to know Tel: (02) Fax: (02) admin@pmk.net.au Website: What is Fringe Benefits Tax A fringe benefit is a benefit provided in respect of employment (usually provided to employees and their associates) on which employers must pay Fringe Benefits Tax. FBT is separate from Income Tax and is calculated on the reportable value of the fringe benefits provided during the FBT year. The FBT rate of tax is 46.5%. Employers will usually need to report the reportable value of fringe benefits on their employees PAYG Payment Summaries. On top of this, reportable fringe benefits are included when calcula.ng the workers compensa.on premiums and payroll tax. The value of most fringe benefits can be reduced by what is known as an Employee Contribu.on. This is where the employee contributes towards the fringe benefit e.g.; car expense payment, an amount withheld from the employee s a2er tax salary, and/or shareholders loan journal entry offset. For the employer, an employee contribu.on is usually taxable income & includes GST. The 2013 FBT year covers 1 April 2012 to 31 March 2013 and if an employer has provided fringe benefits to employees during this period an FBT return will be required to be lodged with the ATO. The lodgement and payment due date of 2013 FBT Returns is 21st May Recent ATO FBT News In November 2011, the government announced reforms to the living-away-from-home allowances and benefits. Further extensions to these reforms were announced in the Budget, upon introducing the legisla.on into parliament in June 2012 to beaer target the tax concession for living-away-from-home (LAFH) allowances and benefits to people who are legi.mately maintaining a home in Australia away from their actual home for an ini.al period. These amendments will: Ensure LAFH allowances are taxed en.rely within the fringe benefits tax system, rather than in the personal income tax system or a combina.on of both; Expand the defini.on of drive-in drive-out workers for the purposes of the reforms, so it includes workers who use their own vehicle to travel to the workplace; Amend the circumstances in which the 12-month.me limit will pause, to provide certainty and simplicity; and Ensure that the provisions that prevent people accessing the transi.onal treatment if they vary' an exis.ng arrangement only apply to material varia-.ons' and do not prevent minor changes such as normal salary increases. Your 2013 FBT Return We are sending out worksheets of informa.on we require in regard to car fringe benefits. You should have received these forms together with this newsleaer. Please complete the necessary informa.on on the form relevant to you & then send it back to our office. If you believe that you have provided other fringe benefits during the 2013 FBT year please contact our office to discuss what informa.on you will need to provide. We ask that you return the relevant completed forms to our office by 23rd April 2013 for prepara.on of your 2013 FBT return. Please do not hesitate in contac.ng our office for assistance and any further guidance. DISCLAIMER: This newsleer is for guidance only, it is not taxaon advice and professional advice should be obtained before acng on any informaon herein. Neither the publisher nor the distributors can accept any responsibility for loss occasioned to any person as a result of acon taken or refrained from in consequence of the contents of this publicaon. This newsleer does not take into account any legislave or other changes made a er 31 March 2013.

au What is Fringe Benefits Tax A fringe benefit is a benefit provided in respect of employment (usually provided to employees and their associates) on which employers must pay Fringe Benefits Tax.

2 FORM A - CAR FRINGE BENEFITS STATUTORY FORMULA METHOD This report must be completed and returned to PMK by 23 April 2013 Cost Price: Car Registration Engine Capacity: CC Litres Date Car first held if purchased during 2013 FBT year: Disposal Date if sold during 2013 FBT year: Form of finance: (Lease, Hire Purchase, Owned outright): Employee contributions - Salary sacrificed amounts after tax: Car expenses (incl GST) paid by employee: Fuel Insurance Registration Repairs & maintance Lease payments Others Other employee contributions: Checklist of additional information to supply: Copy of dealers tax invoice cars purchased in 2013 FBT year Copy of Lease or Hire purchase documentation for cars purchased in 2013 FBT year (if applicable)

sacrificed amounts after tax: Car expenses (incl GST) paid by employee: Fuel Insurance Registration Repairs & maintance Lease payments Others Other employee contributions: Checklist of

3 FORM B - CAR FRINGE BENEFITS OPERATING COST METHOD This report must be completed and returned to PMK by 23 April 2013 Cost Price: Car Registration Engine Capacity: Date Car first held if purchased during 2013 FBT year: Disposal Date if sold during 2013 FBT year: Form of finance: (Lease, Hire Purchase, Owned outright): Log Book Requirements: Year logbook was prepared Business use % as per logbook: Number of days car was not available for private use by employee: Please provide details of why it was not avaiable CC Litres Total Car Operating Expenses for the period 01/04/ /03/2013 (including those paid direct by employee) GST Inclusive Operating Costs Fuel and oil Repairs & servicing Registration CTP Insurance Lease payments Car wash, wax & detailing etc

use % as per logbook: Number of days car was not available for private use by employee: Please provide details of why it was not avaiable CC Litres Total Car Operating Expenses for the period

4 Auto club fees (e.g. NRMA and RACV) Others: Employee contributions - Salary sacrificed amounts after tax: Car expenses (incl GST) paid by employee: Fuel Insurance Registration Repairs & maintance Lease payments Others Other employee contributions: Checklist of additional information to supply: Copy of dealers tax invoice for cars purchased in 2013 FBT year Copy of Lease or Hire purchase documentation for cars purchased in 2013 FBT year (if applicable) Copy of new logbook prepared during 2012 FBT year

Fuel Insurance Registration Repairs & maintance Lease payments Others Other employee contributions: Checklist of additional

5 This report must be completed and returned to PMK by 23 April 2013 FORM C - CAR FRINGE BENEFITS LOGBOOK / EXEMPT VEHICLE DECLARATION Year Logbook Prepared: Distance between home and work (kms): * We declare that a current logbook for the above vehicle shows that the vehicle is used 100% for business purposes & it is garaged on business premises at all times. * We declare that above vehicle is an FBT exempt vehicle and the private use (if any) is basically limited to travel between home and work and other private use is minor, infrequent and irregular. * Delete paragraph not required. Employer's Signature Employee's Signature Dated Dated

is garaged on business premises at all times.

Individual & Family Tax Measures

Budget Budget Highlights Highlights CHANGES & OTHER IMPORTANT INFORMATION Individual & Family Tax Measures Individual Tax Rates The individual tax rates remain unchanged for 2013/2014 and are listed below.