Question:
One of our business unit divisions has a quarterly staff meeting/seminar off premises. The seminar goes for 2 hours and includes morning tea. Is this subject to FBT? The total cost is $1,100 – $800 for the premises and $300 for food.
Answer:
A light meal in the form of morning tea at a quarterly work seminar/meeting should not constitute meal entertainment. Further, on the basis the venue is a meeting type space, the venue costs shouldn’t be an entertainment facility leasing expense.
It is considered the venue hire costs are not a benefit provided to the employees in the circumstances provided.
The morning tea will be the provision of property but the business premises exemption under s. 41 of the FBT Act will not be available.
However, as the meeting is a quarterly event one would think it is reasonable to argue the minor benefit exemption applies.
Alternatively, it may be possible to argue that the meeting/seminar is a CPD session and if the employees were to have paid an amount to attend the session the costs would have been otherwise deductible – refer TD 93/195.