While salary is not subject to FBT, additional benefits such as health insurance packaged into an employee's salary can trigger FBT. This is even in industries where employees are required to undergo medical testing.
In fact, pretty much anything given to staff with a value of $300 or more is likely to incur FBT. There are a number of exceptions but these are very limited.
Salary packaged in-house fringe benefits, where businesses supply staff and their associates with discounted goods and services that are the same as those provided to the customers of the business – such as private schools providing discounted school fees for teachers' kids or retailers packaging employee discounts – have traditionally been subject to more favourable FBT treatment.
However, in the Federal Budget the Government announced they were scrapping the FBT concessions that apply to these benefits. In changes before Parliament, salary sacrificed in-house fringe benefits will be subject to FBT based on the full value of the goods or services from 22 October 2012. The changes are not yet law.
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Last updated April 2013. This article is provided for information purposes only and should not be used in place of advice from your accountant. Please contact us on 02 9957 4033 to discuss your specific circumstances.
This article is provided for information purposes only and correct at the time of publication. It should not be used in place of advice from your accountant. Please contact us on 02 9957 4033 to discuss your specific circumstances.