Now is the time to check whether you have provided any fringe benefits to your employees in respect of their employment that are taxable and make sure you are ready to lodge your FBT return and pay any FBT liability on time.

We are here to help you make sure that you are making the most of planning opportunities and that your business is up to scratch when it comes to its FBT compliance.

A fringe benefit is a 'payment' to an employee, but in a different form to salary or wages.

According to the fringe benefits tax (FBT) legislation, a fringe benefit is a benefit provided in respect of employment. This effectively means a benefit provided to somebody because they are an employee. The 'employee' may even be a former or future employee.

An employee is a person who is entitled, or has been entitled, to receive, salary or wages. Benefits provided in respect of someone who has died are not fringe benefits as a deceased person does not meet the definition of ‘employee’ in the FBT legislation.

The terms benefit and fringe benefit have broad meanings for FBT purposes. Benefits include rights, privileges or services. For example, a fringe benefit may be provided when an employer:

  •  allows an employee to use a work car for private purposes
  •  gives an employee a cheap loan
  •  pays an employee’s gym membership
  •  provides entertainment by the way of free tickets to concerts
  •  reimburses an expense incurred by an employee, such as school fees, and
  • gives benefits under a salary sacrifice arrangement with an employee.
If you conduct your business through a company or trust, you may be an employee of the company or a trustee.
As a guide to whether a benefit is provided in respect of employment, ask yourself whether you would have provided the benefit if the person had not been an employee.
What do I need to do?
We can help manage your FBT obligations for the 2009 FBT year.  Feel free to contact any of our partners or managers to discuss this topic further.
The tax bonus payments are part of the Australian Government’s economic stimulus package. If your 2007–08 taxable income was $100,000 or less and you paid tax, you could be eligible for this one-off payment. If you have already lodged your 2007–08 tax return we will automatically calculate your eligibility and entitlements and send your payment to you.

Am I eligible?

Whether you are eligible and how much you receive will be based on your individual 2007–08 tax return. You are eligible to receive the payment if:
  • your 2007–08 taxable income was not more than $100,000 your adjusted tax liability for 2007–08 is greater than zero (that is, you paid tax).
  • you lodge your 2007–08 income tax return by 30 June 2009 or by a deferred lodgement date that we granted to you before 18 February 2009, and
  • you were an Australian resident for tax purposes during the 2007–08 financial year.
People under 18 years old
If you were under 18 at 30 June 2008, some conditions apply.
For more information visit our website at www.ato.gov.au
Temporary residents and Australians living overseas
If you were an Australian resident for tax purposes for the 2007–08 financial year, and you meet all the other eligibility criteria, you will receive the tax bonus payment. This applies even if you were here on a temporary resident visa.
Deceased estates
If a person dies after 30 June 2007 and an income tax return for the 2007–08 year has been lodged by them or on their behalf before 30 June 2009, a tax bonus payment will be made to the deceased estate provided all of the eligibility criteria are met.

How much will I get?

$900 if your 2007–08 taxable income is up to and including $80,000
$600 if your 2007–08 taxable income is between $80,001 and $90,000
$250 if your 2007–08 taxable income is between $90,001 and $100,000.
 
Payments are tax free and will not be used to offset any of your other tax debts.

How and when will I get it?

Unless you changed your details, your payment will be deposited into the bank or financial institution account you nominated in your 2007–08 tax return or sent as a cheque to the address on that return.
Payments will begin from 6 April 2009 and will be rolled out progressively until all eligible people have been paid.

What is it and am I eligible?

The Government has announced an investment tax break for business.  The tax break, in the form of an investment allowance will provide:
  • an additional tax deduction of 30 per cent of the cost of eligible new depreciating assets acquired under a contract, or started to be constructed, after 12.01am AEDT 13 December 2008 and before the end of June 2009 and installed ready for use by the end of June 2010.
  • an additional tax deduction of 10 per cent of the cost of eligible new depreciating assets acquired under a contract, or started to be constructed, between 1 July 2009 and 31 December 2009 and installed ready for use by the end of December 2010.
New expenditure on existing assets may also qualify.
For both periods, small businesses will be able to claim the deduction for eligible assets costing $1,000 or more. Small businesses must have a turnover of less than $2 million a year to qualify.  For other businesses, a minimum expenditure threshold of $10,000 applies.

What do I need to do?

Other than knowing how the above rules apply, there is nothing you need to do to claim this capital allowance concession. We will do all that for you in the preparation of you tax return for the 2009 financial year. However, feel free to call us if you have any queries at all.