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Fringe Benefits Tax has nothing to do with a dated haircut!
Fiona McKinlay • Jan 18, 2019
A Sunshine Coast Bookkeeper that understands F.B.T. Do you?
Are you having trouble attracting quality staff? This is something that can cause countless headaches for several businesses. One of the solutions is, obviously, offer more money, but that isn’t always something that you can do.
Another option might be free back rubs, but that could come off as creepy and be a short trip to HR.
All kidding aside, one of the best options that you might have heard about is Fringe Benefit Tax (FBT). While it might be something that you are quick to adopt, you need to pause and understand your obligations first before adding it to your employment offers.
So, what is it?
Simply put, it’s an extra tax that you cover for your employee that is for the benefit of the employee in lieu of paying them more money. The tax is calculated on the value of what is being used for FBT.
What can be used for FBT? You have a lot of great questions. Sometimes you need to dangle a quality carrot to get those special recruits. This carrot can take the form of executive car parks, low interest loans, paying of the employee’s private expenses, or a nice car to go in that car park.
When it comes to tax time, you as the employer will pay tax on whatever you are offering them through FBT. Fringe benefits will also need to be reported in the employee’s payment summary, all records for the FBT will need to be separately as it will need to be lodged separately with the ATO.
One of the big things to remember though, is that in order to offer an FBT to an employee you need to first register for the FBT with the ATO.
That can be done here.
The FBT can be signed up for by an existing business with an ABN and those with an existing AUSkey login. If you are a brand new business, you can also apply as long as you’re a sole trader, partnership, company, trust, join venture, or superannuation fund.
If you have any questions about the FBT, you can do what many businesses of the Sunshine Coast have done and contact
Balanced Bookkeeping and Business Solutions.
We know the ins and outs of all the benefits that you can be using to make your business grow.
Sunshine Coast Bookkeeper Services – Xero, Myob, Reckon Bookkeeping
And then there are employee payment summaries and the summary of income and expenses in a profit and loss statement, the record of debtors and creditors, asset purchases and expenditure on improvements, depreciation expense claims and capital gains tax, income tax returns and yearly reports, returns for PAYG withholding, fringe benefits tax (FBT), Goods and Services Tax (GST), and the taxable payments reporting system, meeting superannuation requirements… the list goes on and on.
With so many great software options including XERO, MYOB and Reckon. It’s vital for Balanced Bookkeeping and Business Solutions to be on top of them all. Our expert team can help tailor fit any software your business needs. We proudly keep the Sunshine Coast on top of their accounts. Ask us how we can help you today.
Balanced Bookkeeping and Business Solutions is a local Sunshine Coast company that provides a complete bookkeeping service and solutions for small to medium businesses and can cope easily with both the ATO and ACNC, so that you can pursue the far more rewarding and philanthropic business of fund-raising and distributing to the deserving foundation or trust of your choice.
Balanced Bookkeeping and Business Solutions is a local, Sunshine Coast business that provides a complete bookkeeping service and solutions for small to medium businesses. The principal of Balanced Bookkeeping and Business Solutions has worked in the accounting industry for over 20 years and is a qualified accountant and registered BAS agent, which means that you can discuss the pros and cons of casual and full time and part time employment, knowing that you will receive practical, constructive, valuable advice.
This is only a new initiative as we mention that came into effect as of the 1st of July 2018, so there are still a lot of questions to be answered. This is why a number of clients we serve on the Sunshine Coast have been coming to us at Balanced Bookkeeping and Business Solutions to see their options.
The fact is the Australia Goods and service tax, while it’s not going to just go away, has been around for a long time and people are still getting it wrong when they are doing their books.
