FBT and entertaining: what employers need to know
It is common for businesses to celebrate milestones and occasions with staff parties, events or gifts to recognise and reward employees.
If you’re planning any workplace celebrations, you should consider if the benefits you provide attract fringe benefits tax (FBT).
This will depend on:
- the amount you spend on each employee
- when and where your event is held
- who attends the event
- the value and type of gifts provided.
When FBT may not apply
If your business holds a workplace celebration or provides staff with gifts, these may be exempt from FBT in some situations. This can include when you provide:
- food and drink to your employees that is consumed on your business premises on a working day
- food and drink to your employees or associates (such as partners) off your business premises which costs less than $300 per person and qualifies as a minor benefit
- infrequent gifts to your employees with a value of less than $300 per person and qualifies as a minor benefit
- recreational activities (such as golf) which cost less than $300 per person and qualify as a minor benefit
- benefits to your business clients, as they are not subject to FBT.
FBT best practices
- Keep the right records to stay compliant and avoid unexpected penalties.
- Seek advice from Omnis’ registered tax agents.
- Check the ATO’s common entertainment fringe benefit examples to see what criteria apply to your situation.
Source: Australian Tax Office (31 October 2025) FBT and festivities: what employers need to know
