Fringe Benefit Tax is a tax paid by employer on fringe benefits provided to employee. The cash benefits are taxed through income tax but non-cash benefits don’t. FBT taxes non-cash benefits, thus keeping things fair. Copy the link given below and paste it in new browser window to get more information on FBT (Fringe Benefit Tax):- www.transtutors.com/homework-help/accounting/fringe-benefit-tax.aspx

1. Fringe Benefit Tax (FBT)

2. DEFINITION OF FRINGE
BENEFITS
Fringe benefits are additional
non-monetary benefits than
monetary remuneration given to
employees or their associates
(spouse, children).

3. Some Examples of Fringe benefits
are:
 Company car
 Housing allowance
 Vacation pay
 Sick pay

4. FRINGE BENEFITS TAX
 Fringe benefits tax is tax charged
on the fringe benefits given to
employees.
 Fringe benefits tax is paid by
employer.

5. Some Tax exempted Fringe benefits:
 Achievement awards
 Adoption assistance
 Education assistance
 Accident and health benefits

6. CALCULATE YOUR FBT:
STEP 1: Identify the type of fringe benefit
being provided. Different fringe benefits
have different rules for calculation.
STEP 2: Calculate the taxable value of
each fringe benefit according to their
rules.

7. STEP 3: Gross up the taxable value.
STEP 4: Apply FBT rate to the taxable
value.
STEP 6: Employer will report FBT return
and pay the tax.

8. Year Ending Tax Rate
March 2014 46.5%
March 2015 47%
March 2016 49%
March 2017 49%
March 2018 47%
FIXED BENEFIT RATE :

9. SALARY PACKAGING
 Employee give up its part of salary in
cash and receives non-monetary
benefits of same value.
 Income tax is charged on reduced
monetary salary of the employee.
 It is also known as salary sacrifice or
salary exchange.

10. Hey Friend,
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