2006 Fringe Benefits Tax
The general rule is that all paperwork relating to the benefits need to be kept for five years. This includes employee declarations, contracts relating to the benefits, receipts, bank statements, invoices, and any agreements relating to the benefit.
Records can be kept manually or electronically, but need to be kept in an easy to read, easy to identify method. They also need to be kept in English.
Car Fringe Benefits
If you pay car fringe benefits, logbooks and odometer records must be kept.
Logbooks need to be kept for a period of 12 weeks during any logbook year and are valid for up to 5 years, as long as the car usage is generally the same for each year. Once the five years have passed, a new logbook will need to be completed.
Details to be included in the logbook include the date of the work related journey, the odometer readings at the start and end of each journey, the total kilometres travelled and what the journey was for. If an employee makes more than one journey in a day, the total kilometres travelled can be entered as one.
Odometer records require the odometer reading at the start or end of a period. The most ideal way of recording this is to get a reading from your employee at the close of business on the 31 March.
Receipts and invoices relating to the general running of the car should be kept by either yourself or your employee.
Loan Fringe Benefits
Generally, employee declarations need to be kept and need to be obtained before the FBT return is lodged. These are normally in relation to interest that would have been charged on any loans.
Travel & Airline Fringe Benefits
Employees need to keep a travel diary when travelling for work purposes if the travel is for more than five days and is not exclusively work related. Details that need to be included are the date and place of the work activity, the type of work activity, the time it took and the date the entry was made.
Meal & Entertainment Fringe Benefits
Normally, most small businesses don’t often entertain employees and clients, and when they do, the cost is generally under $100 per person for meals and $25 for entertainment, making the meals and entertainment FBT exempt.
In cases where meals and entertainment occur on a regular basis, 50% of the expenses is subject to FBT.
Please contact ARW if you require more information.
