FBT 2022 – The Good, The Bad & The Ugly

Each year the government and the ATO band together to change the rules and regulations for Fringe Benefits Tax. Below is a snapshot of what has changed for 2022.

The Good

Commercial Car Parking Fringe Benefits – effectively removed due to concessions allowed to businesses with turnover up to $50 Million.

Provision of Multiple Portable Electronic Devices - SBE’s (Small Business Entities) can access concessions whereby the provision of multiple similar/identical devices e.g. laptop, mobile phone, tablet etc during the same FBT year are treated as exempt. (Subject to conditions).

Retraining & Reskilling expenses – FBT concessions are available for expenses incurred / benefits provided to retrain and reskill employees that are to, or have been, made redundant for future unrelated employment, which would be subject to FBT as otherwise deductible rules do not operate to make exempt.

The Bad

Salary Packaging – There are dangers where salary packaging has occurred and is undocumented or poorly documented and can be deemed ineffective.

Re-leasing of Motor Vehicles- ATO issues where a motor vehicle lease has ended term and has been re-leased but the residual doesn’t meet the ATO minimum residual guidelines, and therefore not a bona-fide lease.

The Ugly

ATO set to ramp up FBT audit activity

  • Through use of Data-matching with authorities and insurance companies
  • Review of key tax return labels such as FBT employee contributions, motor vehicles expenses, non-deductible expenses, contractor, sub-contractor and commission expenses, to name a few.
  • Selection for Audit though use of above could lead to further detailed review of typical and other not so typical expense and balance sheet accounts that might indicate that fringe benefits have been provided and not declared.

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