Salary Packaging and FBT – Timing issues of employee contributions and the effect of a journal entry

Do you offer salary sacrifice arrangements to your employees? This article discusses the timing issues that you need to consider where an employee is required to contribute towards the costs of non-cash benefits provided under an effective salary sacrifice arrangement. Effective salary sacrifice arrangements Most organisations offer salary sacrifice arrangements as part of remuneration packaging …

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Salary Packaging Q&A – Refunding after-tax contributions from ceased salary packaging arrangement

Our employee is ceasing their salary packaging arrangement and has excess after-tax contributions. If we refund these contributions, will they be subject to PAYG withholding? Alternatively, can we hold the excess contributions for use in a later FBT year? Question We have an employee who is ceasing his salary packaging arrangement (novated lease vehicle) and …

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GST – The GST gap: Key risk areas identified in the 2017-18 GST administration annual performance report

The GST gap, which is the difference between the amount of GST that should be paid and the actual amount paid, helps us identify common GST mistakes and areas that attract the ATO’s attention. This article discusses key risk areas identified by the ATO and what you need to be aware of. The GST gap …

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General Article – E-invoicing, not electronic invoicing – there is a difference

Money flows out under digital process such as Single Touch Payroll (STP) – what if money could flow in through a digital process? E-Invoicing (a step beyond electronic invoicing) is coming. Readers will be aware that for many businesses, money has been flowing out through a fully digitised process under the STP regime for some …

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FBT Q&A – Car transferred to employee as part of redundancy package

Question An employee was made redundant and as part of his redundancy package there was the transfer of ownership of a vehicle to him with an approximate market value of $23,000. Please provide guidance as to correct treatment of this benefit. Answer As the car was agreed to be transferred as part of the employee’s redundancy …

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FBT Q&A – Are exempt ‘workhorse cars’ subject to the car parking fringe benefit rules?

Do we need to pay FBT on the ‘car parking’ of a utility truck designed to carry a load of less than one tonne where there is no FBT payable on this vehicle due to usage being limited to work-related travel and other minor, infrequent and irregular private travel? Question We understand that certain cars …

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FBT – Overseas conferences: The apportionment conundrum!

Do you have staff attending conferences away from their usual place of residence? Attendance at overseas and interstate conferences raises a key issue for FBT: the extent to which the taxable value of benefits provided to the employee in connection with attending these conferences can be reduced under the ‘otherwise deductible rule’. This will particularly …

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FBT Q&A – What are the FBT implications of benefits and outplacement services provided to former employees?

What are the FBT implications of benefits provided to former employees? This Q&A discusses some possible exemptions for employers that provide benefits or services to an employee as part of their redundancy. Question In January 2019, our organisation paid training course fees of $3,500 to a state government TAFE for a former employee to undertake a Diploma …

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Payroll – Why do we need to disclose exemption from FBT under s. 57A on an employee’s payment summary form?

Payment summaries now require an employer to indicate whether they are exempt from FBT under s. 57A of the FBTAA. This is due to changes to eligibility measures for various Federal Government benefits, payments and income tests. Specifically, The Department of Human Services (DHS) has changed how reportable fringe benefits amounts (RFBAs) are used to …

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Payroll – What to expect from the NSW Review of Payroll Tax Administration

The NSW Productivity Commission (the Commission) has presented its conclusions from its review of the administration of payroll tax (PRT)—Review of Payroll Tax Administration (the Review). The NSW Government has, basically, accepted all of the Commission’s recommendations in its Government Response (the Response). The outcomes of the Review are summarised below in the order dealt …

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