Is reimbursement of a visa application cost subject to FBT?
We have recently employed a new staff member and paid for their Visa application for their right to work in Australia. Is this subject to FBT as an expense payment benefit?
Transport provided to an employee and family members as a consequence of an employee being required to relocate his/her usual place of residence, or live away from home in order to perform employment duties is an exempt benefit under section 58F of the FBT Act.
Relocation transport encompasses an expense payment benefit where the recipient’s expenditure is in respect of the provision of transport, or meals or accommodation in connection with transport. ‘Transport’ is not defined in the FBT Act but, by virtue of subsection 142A(1) of the FBT Act, expenditure by an employee on accident insurance, airport or departure tax, a passport, a visa, a vaccination or any similar matter ‘in connection with transport’ is taken to be ‘in respect of the provision of, or to consist of, transport’.
As such, if the Visa application was to enable the employee to relocate to Australian in order to work for you, FBT exemption appears available.
This should be compared with visa costs for an employee to remain in Australia – in this case the visa is not to enable them to relocate but rather to remain here and, as such, no FBT exemption would be available.
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