Checklist: Have you assessed your Fringe Benefits Tax risk lately?
Checklist: Have you assessed your Fringe Benefits Tax risk lately?
Navigating the complexities of Fringe Benefits Tax (FBT) can be a daunting task for any organisation. To help you stay compliant and avoid potential pitfalls, we have prepared a practical and easy-to-use FBT Risk Assessment Checklist. This checklist is designed to guide you through the key areas of risk that employers should consider when managing FBT obligations.
Why is FBT compliance important?
FBT compliance is crucial for ensuring that your organisation meets its tax obligations and avoids costly penalties. By understanding and addressing the key risk areas, you can safeguard your business and maintain a positive relationship with the tax authorities.
What does the Checklist cover?
Our FBT Risk Assessment Checklist covers:
- Work from home expenses: Assess whether your organisation has provided employees with items to facilitate remote work, such as laptops, mobile phones, and internet reimbursements
- Vehicle benefits: Evaluate the implications of providing vehicles to employees, including considerations for electric cars and salary sacrifice arrangements
- Living Expenses: Determine if your organisation is paying for employees' living expenses, such as meals and accommodation, and understand the implications
- Entertainment: Review the provision of food, drink, and recreation to employees and assess whether these benefits are subject to FBT
- Employee vs Contractors: Ensure that individuals engaged as contractors are correctly classified for tax purposes to avoid FBT liabilities
- Expense Payments: Identify any expense payments for fringe benefits provided to employees, such as private health insurance premiums and gym memberships
- Exemptions: Explore the various FBT exemptions available to employers and determine if your organisation qualifies for any of them.
Top 10 FBT Risk areas:
- Work from home expenses
- Cars (in general)
- Electric cars
- Living expenses
- Living-Away-From-Home Allowance (LAFHA) vs Travel Allowance vs Relocation Expenses
- Entertainment (in general)
- Entertainment (not-for-profit)
- Employee vs Contractors
- Expense Payments Benefit
- Exemptions.
How to use the checklist
Download the checklist, fill it out, and include it in your compliance records. If you need assistance, please complete the checklist and return a copy to one of our tax advisers for discussion. Our team of experts is here to help you navigate the complexities of FBT and ensure your organisation remains compliant.