Here’s what fringe benefits tax (FBT) employers should be aware of when it comes to office celebrations.
For parties held on business premises, no FBT is payable for parties held exclusively for current employees. However, you cannot claim a tax deduction or GST credits for the cost.
Where the party includes employees, associates and clients with cost less than $300 per head, no FBT is payable, but no tax deduction or GST credits can be claimed. If the cost exceeds $300 per head the portion of the cost attributable to associates (for example, an employee’s spouse) is subject to FBT. Amounts subject to FBT are tax-deductible, and GST credits can be claimed. Other amounts are not deductible.
For parties held away from business premises costing less than $300 per head, no FBT is payable, but you cannot claim a tax deduction or GST credits.
Where the cost exceeds $300 per head, FBT is payable for each employee and their associates who attend. You can claim a tax deduction and GST credits for these amounts. If clients are in attendance, the client costs are not subject to FBT, but you cannot claim a tax deduction or GST credits.
Katrina Brennan, Principal, SRJ Walker Wayland Business Growth Advisors, Accountants and Auditors, Level 2/2 Innovation Parkway, Birtinya, 5301 9957, srjww.com.au
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