When it comes to fringe benefits tax (FBT), a simple mistake or omission can attract the ATO’s attention. Small businesses are encouraged to be mindful of focus areas that provide clarity in their reporting obligations and entitlements to avoid penalties from the statutory agency.
Businesses are encouraged to avoid behaviours, characteristics and tax issues that may attract the ATO’s attention. Below are some areas of interest highlighted by the ATO concerning FBT reporting for businesses.
Errors to avoid with FBT reporting:
- failing to report an employee’s private use of a company car
- claiming exempt food and accommodation in living-away-from-home allowance benefits
- undervaluing employee car park benefits
- incorrectly claiming employer exemptions and rebates.
- If you are a director or associated with the company and are using benefits such as car for private purposes, you are subject to FBT as well.
The list above is just some of the factors that may affect FBT reporting and is thus, not inclusive. To be sure that you are not breaching the FBT rules, speak to an adviser today.