Summary
Federal Budget 14 May 08 salary packaging changes
Core fringe benefits tax data for the year ended 31 March 2008
Commissioner of Taxation V Indooroopilly Children Services (Qld) Pty Ltd
FBT reporting exemption on Pooled or Shared Cars
Minor Benefits
Employee Contributions to reduce the impact of FBT
Federal Budget 14 May 08 Salary Packaging changes
Effective 14.5.08 salary packaged laptops, printers, software electronic diaries, and tools of trade must be primarily used in the employee's employment to be provided as benefits which are exempt from FBT. This brings them into line with the rules for mobile phones. [Primarily means an over 50% use.]
Depreciation of the above items in the empoyee tax return also ceases, to eliminate a double tax deduction.
Core fringe benefits tax data for the year ended 31 March 2008:
The FBT tax rate remains at 46.5%. The FBT rebate for non-profit employers remains at 48%.
Employers need to report aggregate fringe benefits provided in the year over $6,614.
Taxable benefits need to be disclosed on the employee 07/08 payment summary where they exceed $2,000. [Previously $1,000].
Gross up formulas are 2.0647 where the employer is entitled to claim GST input tax credits and 1.8692 where the employer is not entitled to claim GST input tax credits.
FBT returns are to be lodged by 21 May 08 if self assessed and 28 May 08 if lodged through a tax agent such as SPG Guardian.
FBT is payable quarterly as follows where GST is remitted quarterly and the FBT payable is over $3,000: 28 July, 29 Oct, 28 feb, 28 April, and balance date 21 May 08.
Where GST is paid monthly, the above quarterly payment dates are advanced by 7 days.
Illustrative 07/08 rates for an expatriate employee living-away-from-home-allowance food component are: one adult [ over 12 yo] $206 per week, two adults $330, p/wk, two adults and two children $370 p/wk.
Indexation factors for 07/08 non-remote housing fringe benefits are Queensland 1.057, WA 1.053.
Car fringe benefit statutory fractions are unchanged and are: <15,000kms pa - 26%; 15,000 to 24,999 kms pa - 20%; 25,000 to 40,000 kms pa - 11%; and over 40,000 kms pa - 7%.
The car parking threshhold for 07/08 is $6.78 per day. [Previous year $6.62].
Personal tax rates for the year ended 30 June 08 are: <$6,000 - 0%; $6,001 to $30,000 - 15%; $30,001 to $75,000 - 30%; $75,001 to $150,000 - 40%; and >$150,001 - 45%. The medicare levy is an additional 1.5%.
Commissioner of Taxation V Indooroopilly Children Services (Qld) Pty Ltd
In February 2007 the Full Federal Court upheld that FBT would not apply to the provision of shares to the trustees of certain employee share planes. The Court confirmed that for a benefit to be a taxable fringe benefit, it was necessary that a particular beneficiary be identified as the employee and beneficiary to wjoma benefit is provided. The ATO will now amend TR 1995/5.
FBT reporting exemption on Pooled or Shared Cars
The FBT Amndment Regulations 2007 No 1 exclude pooled or shared cars from the FBT reporting requirements. A pooled or shared car is a car that is provided by an employer for the private use of two or more employees. The amendment applies from 1 April 2007.
Minor Benefits
In June 2007 TR 2007/D6 was released addressing the FBT minor benefit exemption of $300 per annum per employee. This exemption can be summarised as; [A] it applies to each benefit and it is not an upper limit, [B] it does not apply to meal benefit election using the 50/50 basis, [C] it does not apply to salary sacrifice benefits. However, SPG Guardian's minor salary sacrifice charges remain exempt under the 'otherwise deductible rule' as we are registered tax agents.
Employee Contributions to reduce the impact of FBT
The ATO reminds employers that employee contributions to reduce the impact of taxable benefits needs to be made from employee post tax income, and is subject to GST input tax in the hands of GST registered employers.