In preparation for the end of the finge benefits tax (FBT) year, Erin attended the annual NTAA FBT conference in Melbourne to find out what’s new for FBT in 2015, namely:
- How FBT can affect hiring and firing staff
New FBT rate to apply for the 2015 FBT year:
- In 2015, the FBT tax rate will increase to 47%. The rate for 2014 and previous years was 46.5%.
- For 2016 and 2017 years the FBT tax rate will temporarily increase to 49% in line with the income tax rate for those in the top marginal rate earning over $180,000.
There will be an ATO Audit Spotlight on employees taking overseas/interstate holidays after attending a business conference.
Travel costs for employees attending training or conferences are generally deductible to the employer when certain conditions are met.
There is a growing trend for employees to take leave following one of these events and extend their stay. It is important to apportion the cost of airfares and accommodation to reflect these situations, and only claim a deduction for expenses relating to a conference or training.
Interestingly, the ATO suggests a deduction for 50% of the cost of airfares is appropriate for an employee on 27 days of travel with a 3 day business conference. This is contrasted with an employee on 85 days travel with a 3 day conference, in which no deduction would be available for the cost of airfares.
As your accountant, it is important that we fully understand the complexities of accounting legislation and stay on top of any changes in a constantly changing financial landscape.
Contact Erin or one of our professional tax team for more information about the fringe benefits tax.