FBT – Car Parking threshold for FBT 2021

If employer-provided parking is supplied to employees, have you considered whether the applicable car parking threshold is exceeded for the 2020-21 FBT year?

We remind TaxEd members that the car parking threshold for the 2020/21 FBT year is $9.15.

The threshold is one a number of matters an employer needs to consider when determining whether it provides car parking fringe benefits.

Understanding the car parking threshold is critical to correctly complying with the car parking fringe benefit rules.

If there is a commercial car parking station located within 1km of the employer-provided parking and where the lowest all-day parking fee at the station on the first business day of the FBT year is more than the threshold, a car parking benefit prima facie exists.

It should be remembered that the lowest all-day parking rate can be determined by dividing any periodical rate (say monthly or weekly fee etc.) charged by the commercial car park by the number of business days in the period. Business days exclude weekends and public holidays.

For example, assume on 1 April 2020 a car park charges $10 for all day parking but $180 for monthly (24/7) access. Where there are 20 business days in the April period the monthly periodical rate equates to $9. As such that car park has a lowest all-day fee less than the threshold and would not trigger a car parking fringe benefit.

This article provides a general summary of the subject covered and cannot be relied upon in relation to any specific instance. It is not intended to be, nor should it be relied upon as, a substitute for professional advice. TaxEd Pty Ltd and any person connected with its production disclaim any liability in connection with any use.