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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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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Salary Packaging Q&A – S. 58X exemption: Do we need a declaration that covers portable electronic devices?

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 …

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Salary Packaging Q&A ‘ Income protection and life insurance policy costs

Question Our organisation is planning to allow salary sacrifice for our employees in regards to their income protection insurance and life insurance policy costs. We will reimburse these policy costs and reduce their pre-tax salary accordingly. Can you please let me know if it will result in a fringe benefit tax liability or is there …

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Salary Packaging Article ‘ Superannuation guarantee salary sacrifice integrity measures introduced to protect employee entitlements

Superannuation guarantee salary sacrifice integrity measures have now been tabled by the Federal Government by way of an Exposure Draft. The ‘Treasury Legislation Amendment (Improving Accountability and Member Outcomes) Bill 2017: superannuation guarantee (salary sacrifice integrity measures)’ proposes amendments to ensure that an individual’s salary sacrifice contributions cannot be used to reduce an employer’s superannuation …

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