We would like to provide an employee with a declaration that shows they satisfy the requirements of an exempt benefit for an electronic device they have purchased. How should the declaration be worded?
The s. 58X exemption for a portable electronic device does not require a declaration from the employee. However, it is usual for the employee to provide a request for approval of why the item is required ‘primarily for use in the employee’s employment’. This also shows that the employer is satisfied that a s. 58X exemption is available in a salary sacrifice scenario.
Accordingly, it is a good form of governance/record keeping to secure a request from the employee for approval by the employer. This request can be along the lines of the example provided below. We also assume that your organisation has salary sacrificing policies that generally outline how salary sacrifice arrangements work and that support the salary sacrifice arrangement being effective.
I, ___________________________________________________________ (staff member’s name) declare that the items claimed in question 2 are primarily for work-related use and state the following:
1.The reason the item(s) is being requested (i.e. to allow work while travelling or from home of off-site etc.)
___________________________________________________________
2.The type of item requested and nature of work to be performed using the item(s) (i.e. writing up reports etc.)
___________________________________________________________
3.How the use of the item relates to your employment (i.e. allows work while offsite, when travelling or during afterhours work)
___________________________________________________________
4.Have you received a substantially similar portable electronic device provided for work-related purposes by the employer during the same FBT year? If yes, please provide details below (Note: this will normally preclude you from sacrificing a similar item in the same FBT year)
___________________________________________________________
Staff member’s Signature: _______________________________
Dated: / /
This article provides a general summary of the subject covered as at the date it is published. It cannot be relied upon in relation to any specific instance. TaxEd Pty Ltd and any person connected with its production disclaim any liability in connection with any use. It is not intended to be, nor should it be relied upon as, a substitute for professional advice.