TABL2751 - Fringe Benefits Tax

In relation to Fringe Benefits Tax (FBT) which of the following statements is most correct?

• FBT was introduced as another tax on income.

• FBT was introduced on 1 April 1986.

• FBT was introduced to keep tax agents and accountants busy.

• FBT was introduced to tax employees on benefits provided by employers.

• FBT was introduced to tax employers on benefits provided to employees.

In relation to liability to Fringe Benefits Tax (FBT) which of the following statements is most correct?

• Carried forward revenue losses can reduce the amount of FBT payable.

• A company will not be liable to FBT if it has current year tax losses.

• A company may be able to claim a tax deduction for FBT paid.

• Employers and associates of employers may be liable to FBT.

• Entities not subject to income tax will not be liable to FBT.

Which of the following is not a type of fringe benefit as provided in the fringe benefits tax (FBT) legislation?

• Car fringe benefit.

• Expense payment fringe benefit.

• Housing fringe benefit.

• Non-cash fringe benefit.

• Residual fringe benefit.

Emma Waterford is an engineer employed by Construct Pty Ltd. Emma’s remuneration package in 2019/20 includes:

· Salary of $90,000 per annum

· A company mobile phone valued at $1,800, which she is supposed to use when contacting clients

· Payment of her sports gym membership of $300

· A laptop for work, valued at $1,200.

The amount of FBT payable by Emma on the above benefits is:

• $0

• $295

• $3,226

• $2,933

• $300

Nicholas works for Coastal Constructions Ltd and incurred credit card expenses of $3,300 including GST. All of these expenses are private in nature. Coastal Constructions paid the $3,300 on behalf of Nicholas on 4 February 2020. This is the only benefit provided by Coastal for the FBT year ended 31 March 2020. Nicholas gave Coastal all the relevant invoices to enable Coastal to claim the relevant input tax credits.

What is the company’s FBT liability as a result of paying the credit card expenses?

• $6,864.66

• $3,300.00

• $3,226.39

• $3,363.68

• Nil