Was great to be one of the organisers of TAXPO 2023 and embrace our Top Tax Gun Theme. I really enjoyed all of the speakers and meeting new people. My session focussed on ATO FBT audits and what Small Businesses need to do to avoid or manage an FBT audit.

Next stop Melbourne at the Grand Hyatt Hotel on Thursday 19 October 2023 – more information to be shared soon.

Check out the highlights video I posted on LinkedIn (you may need to copy and paste the link to your browser):   https://tinyurl.com/y66jp4hf

Here is the TOP TAX GUN agenda:

We are all ready to go for TAXPO this Thursday 16 February, at the Hilton Sydney.

Register here:  https://form.jotform.com/223487019902862

The ATO’s new ruling on Car Parking and FBT TR2021/2 has been released to reflect contemporary commercial car parking arrangements and legal developments including the Federal Court decisions in Commissioner of Taxation v Qantas Airways Ltd [2014] FCAFC 168 and Virgin Blue Airlines Pty Ltd v Commissioner of Taxation [2010] FCAFC 137.

The ruling has simplified (and broadened) the definition of what constitutes a commercial parking station for the purpose of assessing and calculating FBT liability for car parking.

Practically, car parking stations at shopping centres, hospitals, hotels and the like that were previously not considered commercial for the threshold and valuation tests, are now considered to be commercial car parking stations.

If you are unsure of your car parking FBT obligations, we suggest that you consider further sooner rather than later – the new rules commenced back on 1 April 2022 and will need to be considered in your 2023 FBT Return.

Whilst the definition of what is a commercial parking station is now easier to understand, it will create more headaches for employers. Let us be the panadol to your car parking headache and request a no obligation fee quote to do the heavy lifting for you:  https://form.jotform.co/80218922354859

I was recently asked – What are some practical tips on how to get my clients to take the need to register for FBT seriously?

My suggestions regarding the implications of not being registered and reasons for being registered:

1. If your not registered for FBT then you won’t be thinking about FBT – ie there is no annual obligation. By registering for FBT, you need to be thinking about FBT at least once a year (hopefully more frequently)
2. ATO are actively FBT auditing Small Businesses
3. The ATO have identified a $1 billion FBT gap and attribute this loss of revenue to small business
4. The ATO are extracting vehicle registration in each State and Territory and checking against FBT registration – this is real low hanging fruit
5. If an employer is not registered for FBT, then the ATO has unlimited powers to audit past years – we are seeing some audits going back up to 12 years and in one current FBT audit 16 years
6. If registered for FBT, the ATO will generally only look back at 2-3 years and be more accepting of genuine mistakes
7. In addition to FBT liabilities, the ATO will charge penalties (up to 200%), accrued interest and failure to lodge penalties
8. The ATO will expect any past Reportable Fringe Benefit obligations to be complied with in relation to current and former employees – this can get messy very quickly. Employees (and former employees) will expect the employer to foot the bill of any personal income tax return amendments, and request other compensation
9. From the FBT audits we have been involved with, the ATO are also raising concerns with Income Tax deductibility and entitlement to claim GST credits
10. There are 13 defined fringe benefit categories – FBT is not just about Motor Vehicles and Entertainment
11. The grossed up value of Fringe Benefits must be included in the calculation of Taxable Wages for Payroll Tax liability calculation and calculating Workcover premiums
12. The ATO are actively encouraging Tax Agents to ensure they have a “FBT Service Line” offering and that Tax Agents are engaging with their clients on FBT
13. Reputational Risk and Business Disturbance, High Stress Levels

I hope the above helps. Happy to discuss further.