Fringe Benefits & Business



What is not liable for fringe benefit tax?
Benefits that are not liable for fringe benefit tax include:

  • cash remuneration (e.g, salary and wages, lump sums, bonuses, withholding payments, interest and dividends)

  • benefits given instead of a non-taxable cash allowance (for example, a meal given instead of a meal allowance)

  • free board and lodging

  • some forms of entertainment.


Fringe benefit tax on specific benefits

Motor vehicles, low-interest loans, free, subsidised or discounted goods and services, employer contributions to funds, insurance and superannuation schemes and other benefits.

  1. Motor vehicles
    As a general rule, as long as you have a vehicle available for an employee to use privately, you will have to pay FBT whether or not your employee actually uses the vehicle privately. But there are certain exemptions from FBT - general and daily.

  2. Low-interest loans
    FBT is charged on low-interest loans made to employees. A loan includes all advances (such as salary advances), deposits, money lent in any other way, and any credit given (including delaying the recovery of a debt). FBT is not charged on the actual loan provided by an employer to an employee. FBT is calculated on loans by comparing the interest on the loan with the interest calculated using the prescribed rate.

  3. Free, subsidised or discounted goods and services
    If goods are provided for an employee at less than the cost to the employer, then this is a fringe benefit. Also if services are provided to an employee at less than the normal cost to the public, this is also a fringe benefit.

  4. Employer contributions to funds, insurance and superannuation schemes
    Any contributions you make for your employees to any of the following are subject to FBT. This includes contributions to sick, accident or death benefit funds, insurance fund of a friendly society, life, pension, personal accident or sickness policies and superannuation schemes to which SSCWT does not apply.

  5. Other benefits
    There are some other benefits that may also be liable to FBT.