What’s Hot in Salary Packaging?
The following are the current Hot items in the world of Salary Packaging:
C.Taxis – home to work / work to home
D.Cars – OCM & ECM
F.Meals & Facility Leasing
H.Fly In Fly Out Car Parking
I. Car Parking
Cars, being the most common and highest valued benefit, continue to be a major ATO focus. The ATO are targeting cars on a number of fronts….
Luxury cars and use of logbook
The ATO have focussed closely on the use of log books in respect of luxury vehicles, especially high end luxury sports cars.
We highlight the following key action items:
- Do you have logbooks for every car where the logbook method has been adopted historically? If there is no logbook, then revert to the statutory formula method for 2012. Consider the exposures you may have for the earlier years, not just the FBT liabilities, but also payment summary reporting errors and underpayment of payroll tax
- Do you have a process in place for reviewing & approving logbooks or do you accept the word of your employee?
- Does the business percentage make sense? Is it realistic given the employee’s role and responsibilities?
- Assuming the business percentage is high (80% plus), then what are the nature of the business trips and why have they been undertaken?
- Make sure you have original signed versions of logbooks on file and check that they have not expired or that the employee role / duties remains the same as when the logbook was originally prepared.
Documentation of the above should be included on the employee’s personal payroll file, especially where the car is salary packaged.