FBT & super: things you should know

20 April 2011

The FBT year runs from 1 April to 31 March and is one of those areas that many employers struggle with; not because the tax is complex but because of the level of detail required to fulfill your obligations.

One of the key problem areas concerns reportable superannuation contributions, which need to be disclosed on employee payment summaries. This reporting requirement has been in place since 2010, however employers continue to make mistakes in their reporting.

Super contributions and FBT

Broadly speaking, super contributions made by employers will be captured by disclosure rules if the employee has negotiated the amount of super or the manner in which it is contributed. For example:

• Contributions made under a salary sacrifice arrangement that exceed the 9% super guarantee amount;
• Contributions in excess of the 9% super guarantee amount that are made within an employment contractor agreement;
•  Contributions that exceed the 9% super guarantee amount and are made to family members who are employed by a family-owned business.

Even though the employee will not be taxed on the amounts reported, they will be taken into account in determining entitlement to certain tax and Centrelink benefits as well as liability for certain tax liabilities such as Medicare levy surcharge.


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