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What You Need to Know About 2024 Fringe Benefit Tax

Admin • Apr 09, 2024

On 31 March 2024, the Fringe Benefits Tax (FBT) year ends. With the ever-increasing budget deficits as a result of COVID-19, the ATO will be reviewing whether all employers who sh ould be paying FBT are paying it, and that they are paying the right amount. The ATO has recently announced that the ‘FBT gap’ is now over $1.3 billion and will be deploying resources for FBT compliance to close this gap.

To help you meet your FBT obligations, we’ve put together a list of essentials every employer needs to know about FBT and review every year, such as:

      1. SHOULD YOU BE REGISTERED FOR FBT?

Generally, if you have employees (including Directors) and you provide them with cars, car parking, entertainment (food and drink), employee discounts, loans, or reimburse private expenses, then you are likely to be providing a fringe benefit and we will need to register your business for FBT. There are 13 defined Fringe Benefit categories in the FBT law.


It’s important you start gathering all the details of these provided benefits as soon as possible using our annual FBT Questionnaire and Schedules, so we can calculate any potential FBT liability and lodge your FBT return on time – due 25 June 2024 with payment to be made by 25 June 2024.

        2. SHOULD YOU LODGE AN FBT RETURN EVEN IF NO FBT IS PAYABLE? 

Where no FBT is payable there is legally no need to lodge an FBT return, but should you lodge one anyway?


Our strong recommendation to you is yes, you should lodge an FBT Return if you provide benefits to employees, even if no FBT is payable.


This restricts the ATO’s audit window to only 3 years from the date of lodgement. Otherwise, the ATO is entitled to go back an unlimited number of years and audit your business and possibly find areas where they will charge you 

FBT and penalties.


We have compiled an FBT Factsheet that outlines some of the simple points that the ATO will review if you are selected for audit – How the ATO identifies potential audits. We have also prepared an FBT Factsheet that outlines why an FBT return is a good idea even where no FBT is payable – Why should you lodge a return.

     3. KEY THINGS YOU MUST DO ON 31 MARCH 2024

     4. WHAT ITEMS ARE EXEMPT FROM FBT

The following items are unlikely to be subject to FBT: mobile phones, laptops, tablets, portable printers, protective clothing, tools of trade etc, or minor and infrequent benefits that are less than $300 in value.


To find out if you are eligible for the minor and infrequent benefit exemption – please ask us to send you our Applying the Minor & Infrequent Benefits Exemptions factsheet.


You can fill out our FBT Questionnaire and Schedules to be 100% sure.

     5. WAYS YOU CAN REDUCE YOUR FBT LIABILITY


    Here are some ways in which you can reduce your FBT liability:


  • replace your fringe benefits with cash salary;
  • provide benefits that your employees would be entitled to claim as an income tax deduction if they had to pay for the benefits themselves;
  • look at providing benefits that are exempt from FBT; and
  • use employee contributions, for example, an employee paying for some of the operating costs of car fringe benefit such as fuel that you don't reimburse them for. You need to be aware that employee contributions will be deemed assessable income to you and subject to GST.


We look forward to helping you meet your FBT obligations and are available anytime to answer any questions you have around reducing your FBT liability or creating effective salary sacrifice arrangements.

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