Businesses no longer have to feel like a Scrooge during Christmas, with changes to fringe benefits tax (FBT).
For starters, the minor benefits FBT threshold has been increased from $100 to $300. “While this increased threshold applies to all minor benefits throughout the year, most businesses will find it particularly useful at Christmas,” says Jolyon Dare, HLB Mann Judd Sydney manager. “It means that they can now spend up to $300 per employee on the Christmas party, rather than the previous $100, and pay no FBT.”
Changes have also been made to associated benefits. “In the past, any benefits provided in association with other benefits were added to each other rather than treated separately. The draft ruling takes a more liberal view on this,” says Dare. “Taking the Christmas party as an example, a business holding an office party previously had to include the cost per employee, plus the cost of their spouse if also attending, plus any Christmas gifts presented at the party, within the threshold in order to avoid FBT.
“This would have meant spending less than $100 in total per employee, or else the business would be liable for FBT at the rate of 46.5 percent. “To avoid this associated benefit link, many businesses chose to give presents up to two weeks before the party, and spouses often weren’t invited to such company functions.
“Under the new draft ruling, businesses can now spend up to $300 per employee on the Christmas party, plus $300 on the employee’s spouse, plus another $300 on a Christmas gift (even if the gift is provided at the party), and still be within the FBT-exempt threshold – helping make it a very merry Christmas indeed!”
Bookmark article at:These icons link to social bookmarking sites where readers can share and discover new web pages. powered by moSociable 1.0.1 by www.waltercedric.com
