Your guide to FBT year end for 2024

1. The fringe benefits tax rate for the 2024 FBT year is 47%.
2. The ATO are focusing on the commonly provided fringe benefits (e.g. car benefits) and record keeping requirements generally. Ensure you have kept all required records.
3. There are constant developments on the meaning of an employee and independent contractor. Care should be taken when reviewing if a benefit provided falls under the FBT regime.
4. The benefit for ‘taxi travel’ between home and work is exempt from FBT under a specific provision of the FBT Act and includes ride sharing services such as Uber.
5. Remember to obtain all required employee declarations and log books to support the claim for a reduction in FBT.
6. FBT on meal entertainment is unable to be calculated using the 50/50 split and 12 week register methods if meal entertainment is provided to an employee under a salary packaging arrangement.
7. Emergency benefits assistance, such as relating to COVID-19 may be considered exempt benefits.
8. If the FBT exemption for eligible electric cars applies, the value of the exempt car benefits is still required to be included in the reportable fringe benefits amount calculation for an employee. For more details, check out our article on Electric Car FBT exemption.
9. You will be required to add any reportable grossed-up value for individual employees into your payroll system.
10. The ATO has issued draft legislative instruments to allow the use of alternative records to reduce the burden of record keeping; however, these changes are not yet effective so the usual record keeping requirements continue to apply for the FBT year ending 31 March 2024.

• If there is a change in car use (e.g. due to change of work role etc.) – please ensure you take note of this. Whilst existing logbooks may still be valid, consider whether an adjusted business use percentage should be calculated or a new logbook kept which is representative of usage throughout the year.
• For exempt work vehicles, review whether non-work related use is minor, infrequent and irregular.
• Ensure you are across the latest exemptions for electric vehicles – read our ATO analysis here.
• Ensure employee contribution records are up to date.
• Ensure your car expenses are up to date and records are kept.
• Record the total number of days when the vehicle was unavailable to an employee.
• Record your odometer at 31 March 2024.
• Ensure logbooks are still valid and not more than 5 years old.

• Understand what is or isn’t entertainment for FBT purposes and what is tax deductible.
• Record any employee contributions.
• Determine which employees receive frequent versus infrequent benefits.
• If entertainment expenses have reduced, consider if the actual method will result in a more favourable outcome than the 50/50 method due to the ‘minor benefits exemption’.
• Discuss with us your method of calculation (i.e. 50/50, actual method or the 12-week register method). When making a decision, discuss with us the different implications of the available methods as it has an effect on any FBT exemptions available, substantiation requirements, income tax, FBT and GST treatments.

• Obtain an employee declaration on the percentage of business use, supporting documents and basis of calculation.
• Check allowances or expense reimbursement details for phones.
• Consider the exemption available for portable electronic devices that are mainly used for work purposes.

• Ensure your diary has been updated with travel dates and the required details for any extended travel, which is generally travel for more than five consecutive nights (for oversea travel) and travel for more than five consecutive nights which includes private element (for domestic travel).
• The Australian Taxation Office (ATO) issued taxation ruling TR 2021/1 and TR 2021/4 outline when employee transport and travel expenses are considered to be ‘otherwise deductible’. Please contact us for clarification.
• Any accompanying partners? Did work travel turn into personal travel?
• Ensure you have kept the required documents for supporting various travel expenses (e.g. airfare and accommodation).

• The ‘otherwise deductible rule’ will only apply for interest-free loans if made to the employee personally, not an associate.
• Where this does not apply, interest should be charged at the benchmark interest rate of 7.77% for the 2024 FBT year and paid every six months.

• FBT may apply where parking is provided to employees and a commercial car parking station within 1-kilometre charges more than $10.40 for all-day parking.
• Entities with a turnover of less than $50 million may be eligible for a car parking exemption where the employee’s car is not parked in a commercial car parking station.
• The scope of what can be considered a commercial parking station for FBT purposes has increased for car parking benefits provided from 1 April 2022. Ensure you read our ATO technical analysis regarding this change.

If you have a tax agent, both lodgement and payment is due on 25 June 2024.

If you don’t lodge with a tax agent, you need to lodge and pay by 21 May 2024.