FBT Solutions

02 8079 2924

Month: July 2012

What is a contractor?

We often get asked – do we pay FBT on contractors. In order to answer that question

What is a contractor?

An independent contractor is an entity that agrees to produce a designated result for an agreed price.

Contractors can include:

sub-contractors

consultants

sole traders

companies

partnerships

trusts.

In most cases, a contractor:

is paid for results achieved

provides all or most of the necessary materials and equipment to complete the work

is free to delegate work to other entities

has freedom in the way the work is done

provides services to the general public and other businesses

is free to accept or refuse work

is in a position to make a profit or loss.


Managing Employee Expenses, Entertainment and Allowances Training http://www.fbtseminars.com.au/pdf/fbt_Employee_expenses_allowances_training_Apr12.pdf

Covering meal entertainment, travel expenses, food and drink costs, local, overseas travel allowances, tax reporting and policy

Designed for Finance, Accounts Payable, HR, Payroll and Tax personnel

FBT Solutions  is delighted to offer you the opportunity to attend a half day training seminar that will explain the rules to do with employee expenses, food and drink, entertainment and travel expenses.

What we’ll cover

If your organisation provides or reimburses any of the following:

• Employee expenses

• Meal costs

• Entertainment expenses

• Travel advances

• Business travel reimbursements

• Travel allowances

• Per diems

• Living away from home allowances

Anything else? Once you’ve registered, we’ll send you a Questionnaire  – to make sure we cover what you need to know!

What you’ll get

• User friendly guidelines for Meal Entertainment, Food & Drink Costs & Other common employee expenses

• A full set of seminar notes including practical examples

• Plenty of question time

• Free follow up query service

CPD/CPE hours: 4 hours, certificate will be provided

Seminar content includes

• Motor vehicle expenses

• On premises meals v off premises meals

• Credit card reconciliation

• Foreign currencies

• GST free & input taxed purchases

• Travel diaries

• Substantiation

• Tax invoice requirements

• Recommended accounting processes

• Correcting mistakes

• Understand the FBT, GST & Income  Tax implications

• Travelling employees

• Non travelling employees

• Overseas visitors

• Contractors

• Policy requirements

• Travelling clients

• Non travelling clients

• FBT Reporting

• BAS Reporting

• Employee Payment Summary Reporting

• Light lunches

• Functions

How much does it cost?

Your investment: $440 including GST Register by 31 August: $385 including GST.

http://www.fbtseminars.com.au/pdf/fbt_Employee_expenses_allowances_training_Apr12.pdf

When are the seminars

• Thursday 13th September 2012 – Sydney

• Thursday 20th September 2012 – Melbourne

• Wednesday 10th October 2012 – Brisbane

• Wednesday 17th October 2012 – Sydney

Duration: All seminars run from 9am to 1pm

Where are the seminars

The seminars will be held at:

• The Sydney Hilton,  488 George Street.

• The Melbourne Hilton on the Park, 192

Wellington Parade.

• The Brisbane  Hilton,  190 Elizabeth Street.


Better practices for managing specific fringe benefit types (from the ATO website – see link below)

Introduction

This information outlines the legislative basis for fringe benefits tax (FBT) and provides guidance for managing specific benefit types. It outlines better practices that entities can adopt to help ensure that the capture and reporting of information for each benefit type complies with legislative requirements and related ATO rulings and guidance material.

The information is designed to help FBT Managers and other staff who have specific FBT responsibilities such as human resources staff, fleet managers and others involved in the day-to-day administration of FBT, to effectively meet an entity’s FBT obligations.

http://www.ato.gov.au/businesses/content.aspx?doc=/content/00199866.htm


From the Age: http://www.theage.com.au/executive-style/austerity-on-the-corporate-menu-20120718-22ajh.html

HUNG up the ”Will Not Return” sign and headed out for three boozy courses  and a couple of hundred-dollar bottles lately – or has post-GFC austerity put  the kibosh on the long and lavish lunch?

Investor John Mactaggart, a one-time lunch scene stalwart, thinks so. The  fringe benefits tax killed the boozy blowout the first time around and the GFC  has dealt the resurrected version a similar death blow, he says.

A founder of the listed software vendor Technology One, Mactaggart now limits  himself to an annual afternoon-into-evening session with his accountant and  shorter affairs at restaurants and clubs once a month.  Between times, there are  lots more ”cups of coffee down the road at 10 or 11” than once there were.

”People have become more selective about what they do and how they do it,”  Mactaggart said. ”You enjoy it when it’s there but there’s always something  else to do. People are busier – most people don’t even go for a walk at  lunchtime. They don’t see the value in the sort of old-fashioned networking of  the boozy lunch. There’s a perception that unless you’re doing work, you’re not  working.”

Retail development consultant David Hedemann reports a similar pattern of  non-consumption in the construction world; a sector once renowned for keeping  fine dining establishments and gentlemen’s clubs ticking over on a Friday  afternoon. ”It’s not happening in bigger companies any more – budgets have been  cut back,” Hedemann said.

”Lunches have become a lot more targeted – the ‘payback’ needs to be more  immediate.”

Hedemann’s weekly five-star nosh-ups of a decade ago have also been replaced  with ”a lot of coffees”. When more substantial entertainment is called for,  prospective clients are invited to Property Council of Australia functions,  where guest speakers and networking opportunities mean it’s not just a straight  junket.

The popularity of this sort of multi-function entertaining is rising, as the  boozy lunch wanes.

Founder of the Business Chicks networking group Emma Isaacs said booking  tables at organised events had several advantages over old-style, one-on-one  schmoozing.

”You can take eight people at once and do networking that way,” Isaacs  said. ”It’s more cost-effective and everyone can mix.”

Corporate abstinence has helped tighten the pinch for many silver service  restaurants already struggling with dwindling demand for top-end fare in the  evening.

In Sydney, high-profile casualties this year have included Ad Lib, Etch and  the Berowa Waters Inn while further north, the Queensland Rugby Club, once the  place for suits to be seen, went into liquidation earlier this month.

Fine dining comprises 40 per cent of Australia’s $14.3 billion restaurant  bill each year, according to IBISWorld  research. A more prudent spending  climate has kept growth to 1.1 per cent a year since 2007, IBISWorld senior  analyst Naren Sivasailam said.

But prudent is as prudent does, according to restaurateur John Fink. His  family company owns Quay, Otto and The Bridge Room, top-end Sydney nosheries  where tabs don’t come in under $100 a head. Fink says his midday tables are  still well stacked with politicians and high flyers, corporate cutbacks or  no.

”People may not be spending hundreds and hundreds on a bottle of wine but  they haven’t stopped spending either,” Fink said.

Rather, business diners were condensing their meals into a 90-minute window  and eschewing random largesse for a more targeted approach to entertaining.

”People don’t have time to go pissing it up and having three-hour lunches,”  Fink said. ”Yes, people are spending, but only when there’s an actual goal.  People are going for the cheaper options, but if they want to impress they come  to us, or Neil Perry – when it counts.”


From the ATO Website,a good summary of the recent history on the LAFHA changes, with relevant links.

On 29 November 2011, the government announced reforms to the living-away-from-home allowances and benefits. Further extensions to these reforms were announced in the 2012-13 Budget, and upon introducing the legislation into parliament on 28 June 2012.

Under the proposed changes a living-away-from-home allowance will generally be treated as assessable income of the employee rather than as a fringe benefit, with effect from 1 October 2012.

Access to the tax concessions for living-away-from-home allowances and benefits will be limited to:

  • employees who maintain a home in Australia for their personal use and enjoyment that they are required to live away from for work (regardless of whether they are permanent or temporary residents)
  • actual substantiated expenditure on accommodation, and food and drink beyond a specified amount
  • a maximum period of 12 months in respect of an individual employee for any particular work location.

Transitional rules apply to permanent residents who have employment arrangements for living-away-from-home allowances and benefits in place prior to 7.30pm (AEST) on 8 May 2012.

Transitional rules also apply to temporary residents (maintaining a home in Australia for their personal use and enjoyment that they live away from for work) who have employment arrangements for living-away-from-home allowances and benefits in place prior to 7.30pm (AEST) on 8 May 2012.

From 1 October 2012, living-away-from-home benefits (that is, the direct provision of accommodation, food or expense payments) provided to employees who would not be eligible to claim an income tax deduction had they incurred the expenses directly, will be subject to FBT.

Media release

Refer to:

  • media release no. 055, Tax changes to living-away-from-home allowances and benefits introduced into Parliament, issued by the Assistant Treasurer on 28 June 2012
  • media release no. 029, Reform of living-away-from-home allowances and benefits – draft legislation released for consultation, issued by the Assistant Treasurer on 15 May 2012
  • media release no. 148, Tax measures in mid-year economic and fiscal outlook, issued by the Treasurer on 29 November 2011.

Legislation and supporting material

Tax Laws Amendment (2012 Measures No. 4) Bill 2012 and the Explanatory Memorandum, tabled in parliament on 28 June 2012.

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More information

For more information refer to the:


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