Fringe Benefits Tax 2023

Fringe Benefits Tax 2023

The Fringe Benefits Tax [FBT] year ended 31 March 2023.

It is now time for businesses to determine if they have an FBT exposure and if so start to collate the relevant information to complete an FBT return for the 2023 year.

What is FBT?

FBT [Fringe Benefits Tax] is a tax employer pay on certain benefits they provide to their employees, including their employee’s family and other associates.

Common Fringe Benefits

There are various categories of Fringe Benefits. The common Fringe Benefits include:

• Car Fringe Benefits
• Entertainment Fringe Benefits
• Living away from home allowance Fringe Benefits
• Loan Fringe Benefits
• Car parking Fringe Benefits
• Expense payment Fringe Benefits
• Housing Fringe Benefits

There are several exemptions and concessions available for FBT purposes and working from home. We have summarised the major exemptions and concessions below.

Portable electronic devices

As an employer, you may provide employees with items to allow them to work from home. Certain items that are used by employees primarily for work purposes are exempt from FBT [this means no taxing point]. These items include:

• laptops
• portable printers
• other electronic devices

In addition, the minor benefits exemption or the otherwise deductible rule may apply if:

• You allow an employee to use items they would normally use in the workplace such as a monitor, mouse, or keyboard, or
• You provide an employee with stationery or computer consumables or pay for their phone and internet access.

The minor benefits exemption may apply for minor, infrequent and irregular benefits provided under $300.

The otherwise deductible rule allows you to reduce the taxable value of benefits by the amount that your employee can claim as a deduction in their personal tax return.

Electronic Vehicle FBT Exemption

Generally, a car fringe benefit will arise where a car owned or leased by an employer is made available for private use by an employee. 

However, legislation was passed to make certain electric vehicles exempt from FBT. What this means is that from 1 July 2022 employers do not pay FBT on eligible electric cars and associated expenses.

 Eligibility

The electric car needs to meet all the following conditions:

• The car is zero or low emissions vehicle
• the first time the car is both held for use and used on or after 1 July 2022
• the car is used by a current employee or their associates
• luxury car tax has never been payable on the importation or sale of the car.

Activities targeted for Audit by the ATO include

• Motor Vehicle benefits
• Living away from home Allowances
• Car parking valuations
• Gym memberships
• Non-lodgements of FBT return
• Nil Lodgements

Lodging FBT Returns

The 2023 Fringe Benefits financial year runs from the 1^st of April, 2022 to the 31^st of March, 2023. FBT returns are to be lodged by the 25 June 2023.

For more information

If you have any queries regarding the above, or for assistance in completing your FBT return, please feel free to get in touch.

We have also attached the following link for details we will require:

2023 Fringe Benefits Tax Checklist