Consider if fringe benefits tax (FBT) may apply or you could end up with an unexpected FBT liability.
With the holiday season kicking off, you may be planning a celebration with your staff.
Before you hire a restaurant or book an event, make sure you work out if the benefits you provide your employees are considered entertainment related and if they’ll attract fringe benefits tax (FBT).
This will depend on:
- the amount you spend on each employee
- when and where your celebration is held
- who attends — is it just employees — or are partners, customers and suppliers also invited?
- the value and type of gifts you provide.
If you do provide entertainment-related fringe benefits, keep the right records to support this so you can calculate their taxable value.
It’s important to get on top of how FBT works before you provide perks and extras. Otherwise, you may end up with an unexpected FBT liability.
Hiring employees for the festive season?
As the festive season approaches, employers that hire new employees to help with their business should remember the following when it comes to their employer tax and super obligations:
- Employers should make sure they are withholding the right amount of tax from payments they make to their employees and other payees, especially as this will help their employees meet their end-of-year tax liabilities;
- Employers must pay super guarantee (currently at 11.5%) to all eligible employee’s super funds in full and on time to avoid paying the super guarantee charge; and
- If employers are still not reporting through single touch payroll (‘STP’) and they do not have an approved exemption, deferral or concession in place, they should start reporting now. If they have just started a business or recently employed staff, they will need to report through STP from their first payday.
Contact Omnis Group’s Business Accountants if you need help planning your end-of-year business activities around FBT and payroll.
Omnis Group are modern, forward-thinking Business Accountants in West Perth, providing practical, proactive, real-world advice and support that goes beyond the basic preparation and lodgement of tax returns, to identify opportunities for improvement in your business.
