The Fringe Benefits Tax (FBT) year is different to a standard financial year and runs from 1 April to 31 March each year. So what does that mean for those of you that have salary packaging arrangements? You will have to gather the relevant information together and ensure that all kilometres have been run if you have a motor vehicle or that your employer has withheld enough from your wages as part of your package to cover any FBT payment.

If you have a car salary packaged then you’ll need to get your odometer reading in on the 31st March to your provider. And while there is no longer tax scales dependant on the kilometre travelled, it is still required to ensure that your package has been calculated correctly and that the relevant FBT is payable. It helps to ensure that the kilometres match the fuel costs to match your budget so make sure you get this in ASAP. Many providers, including JBS Salary Packaging will accept a photo of your odometer reading as proof.

Did you also know that your FBT calculations on your motor vehicle can change depending on the vehicle availability during the FBT year. So if you were unable to use your car in any period during the FBT year, like if it was with a mechanic getting repaired, you’ll need to let JBS know.

Changes to the Australian Taxation Laws for FBT
The Tax office made changes to the Car Expense Deductions and the Meal Entertainment Benefit rules, with a summary of the details as follows:

Car Expense Deductions
Simply put, you have one of only two options in calculating your deduction. (1) use a single rate of $0.66 per kilometre for all motor vehicles regardless of engine size up to a maximum of 5,000 business kilometres for each car or (2) the logbook method of recording your travels including odometer readings for a minimum continuous period of 12 weeks.

It should be noted that your first trip of the day from home to the first business call is considered private use, and the same with your last trip from a business to home. You might want to arrange your diary and daily appointments to take this into consideration and gain the highest level of business kilometres usage.

Meal Entertainment Benefits
If you are one of the lucky employees who have the opportunity to claim a Meal Entertainment Benefit through Salary Packaging with your employer (Government Department and/or Organisation, Not for Profit or exempt Business), from 1 April 2016, the Reportable Cap has been set to $5,000 per annum. Any claims above the $5,000 will be counted towards the employee FBT commitment. So be aware as a good meal could cost you in FBT.

If you’re with JBSSP, we will have already taken these changes into consideration as part of your package however if you are concerned how these changes may affect you, contact our office for a chat.