University of Tasmania
Browse

File(s) under permanent embargo

Fringe Benefit Tax

chapter
posted on 2023-05-22, 21:10 authored by Sonia Shimeld

This chapter is designed to provide a general analysis of FBT. It covers:

  • The levels of the FBT pyramid
    • The FBT equation
  • Fringe Benefits Tax Assessment Act 1986
  • FBT tax calculations
    • Determining a fringe benefit
    • Specifying a category
    • Checking for exemptions and reductions
    • Calculating taxable value
    • Calculate FBT liability
    • Administration

These basics will provide the necessary background for a sound understanding of FBT.

Fringe benefits tax (FBT) was introduced on 1 July 1986 to overcome the shortcomings (with compliance and valuation) of s 26(e) ITAA 1936. It shifts the liability for the tax from the employee to the employer, and is a separate tax to income tax. It essentially captures the taxable value of certain benefits the employer provides to the employee (or their associate) in respect of employment, over and above salary. This makes it a fairer system as, rather than escaping tax, those benefits are taxed through the employer. Generally the cost of providing the benefits and also the FBT paid are tax deductible to the employer. The most common fringe benefits are:

  • cars
  • car parking
  • expense payments
  • loans
  • meals and entertainment.

Common exempt benefits include:

  • portable electronic devices primarily used in employee’s employment
  • minor benefits valued at less than $300
  • certain taxi travel
  • in-house health care facilities.

History

Publication title

Australian Tax 2011

Editors

P Kenny

Pagination

537-563

ISBN

978-0-409-32756-4

Department/School

TSBE

Publisher

LexisNexis

Place of publication

Sydney

Extent

22

Repository Status

  • Restricted

Socio-economic Objectives

Expanding knowledge in commerce, management, tourism and services

Usage metrics

    University Of Tasmania

    Categories

    Exports

    RefWorks
    BibTeX
    Ref. manager
    Endnote
    DataCite
    NLM
    DC