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FBT issues on the ATO’s radar

The ATO has updated its list of ‘What attracts our attention’, with six items that specifically relate to fringe benefits tax (‘FBT’), as follows:

  • Failing to report motor vehicle fringe benefits, incorrectly applying exemptions for vehicles or incorrectly claiming reductions for these benefits.
  • Incorrectly calculating car parking fringe benefits due to:
    • significantly discounting market valuations;
    • using non-commercial parking rates; or
    • parking rates not being supported by adequate evidence.
  • Mismatches between the amount reported as an employee contribution on an FBT return compared to the income amounts on an employer’s tax return.
  • Claiming entertainment expenses as a deduction but not correctly reporting them as a fringe benefit, or incorrectly classifying entertainment expenses as sponsorship or advertising.
  • Not reporting fringe benefits on business assets that are provided for the personal enjoyment of employees or associates.
  • Not lodging FBT returns (or lodging them late) to delay or avoid payment of tax.

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