In business, compliance with laws, policies, rules and regulations is critical to keep company operations running smoothly. With the help of a professional accounting service, you can stay on top of all your legal obligations as an employer, including compliance with taxation laws.
With the FBT year nearing its conclusion, it’s especially important to know exactly what fringe benefits you provided your employees. If what comprises fringe benefits is still unclear to you, having a professional business accountant on hand means you’ll have someone knowledgeable to depend on to help you identify all possible fringe benefits you need to pay taxes for.
A professional accountant will help you determine various types of fringe benefits, such as meal entertainment and car parking fringe benefits. More importantly, they can help you collate and organise all required documentation and make accurate calculations for filing your FBT return.
This benefit is closely related to the first one. Fringe benefit tax typically involves complex calculations and documentation work. There are certain conditions you need to adhere to and information you must include in each employee’s payment summary for the corresponding payroll financial year. However, there are also some fringe benefits that need not be reflected in payment summaries.
Fringe benefits typically covered by FBT include:
However, the totality of fringe benefits offered by your company can include so many other items you may not think are fringe benefits. This is why you should always consult your accounting consultant, financial services or business advisor regarding these matters. You also need to ensure your books are organised and prepared for further scrutiny, just in case.
Not all fringe benefits need to be taxable. By partnering with a professional accountant, you’ll know exactly where you can save in terms of taxes.
Of course, the reason why employers offer fringe benefits is to attract and keep quality, talented employees. However, it helps to think beyond the usual and focus on what employees value and want beyond typical monetary rewards.
Non-taxable fringe benefit alternatives include helping your
employees achieve a work-life balance and ensuring career progression and professional development. In line with these, you can offer your employees opportunities to work remotely or other flexible work arrangements. You can also provide them with additional leave credits such as birthday leaves, funeral leaves, or simply increasing their leave allotment for the year.
Fringe benefits tax is a grey area for a lot of employers, especially since various items that can be identified as fringe benefits can be easily overlooked.
Ensure you identify and cover all fringe benefits in your company and pay your FBT on time with the help of a professional accountant.
Come next FBT year, things won’t be as uncertain and as difficult as now.