If you’re a business owner, you’re probably familiar with the concept of Fringe Benefits Tax (FBT). Employers who give their workers non-cash perks including corporate cars, health insurance, and travel costs are subject to the FBT tax. If your business provides any of these benefits to your employees, you’re required to lodge an FBT return and pay the tax. Here’s a comprehensive guide to help you understand how to lodge your FBT return and pay for it.

Understand Your FBT Obligations

The first step in lodging your FBT return and paying for it is to understand your FBT obligations. As mentioned earlier, FBT is a tax on non-cash benefits that employers provide to their employees. You may view the detailed FBT instructions provided by the Australian Taxation Office (ATO) online.

The information in this guide can help you understand your FBT responsibilities better, including the benefits that are subject to FBT, how to determine your FBT responsibility, and how to complete your FBT reports.

Gather the Necessary Information

Before you lodge your FBT return, you need to gather all the necessary information. This includes details of all the fringe benefits you’ve provided to your employees during the FBT year, the taxable value of each benefit, and the FBT rate applicable to each benefit. You’ll also need to have details of any exemptions or concessions that apply to your FBT liability.

Calculating Your FBT Liability

The next stage is to determine your FBT liability after you are aware of your FBT requirements. You must first determine the taxable value of each fringe benefit you’ve given to do this. The taxable value is the amount used to calculate the amount of FBT you owe.

The ATO guides how to calculate the taxable value of different types of fringe benefits, including cars, housing, and entertainment. Use the ATO’s online FBT calculator if you’re unsure how to determine your FBT obligation. The calculator will guide you through the process and help you determine your FBT liability.

Lodge Your FBT Return

Once you’ve calculated your FBT liability, you need to report your FBT obligations. You can lodge your FBT return online using the Business Portal or through a registered tax agent. If you’re lodging your FBT return yourself, you’ll need to use the ATO’s online FBT return form. This form will guide you through the process of reporting your FBT obligations and calculating your FBT liability. If you don’t lodge your FBT return on time, you’ll be charged penalties and interest.

Pay Your FBT Liability

After you’ve lodged your FBT return, you’ll need to pay your FBT liability. You can pay your FBT liability online using the Business Portal, by phone, or by mail. If you’re paying by mail, you’ll need to include a payment slip with your payment. The payment slip is available on the ATO’s website.

It’s important to note that the due date for paying your FBT liability is May 21, following the end of the FBT year. If you don’t pay your FBT liability on time, you’ll be charged interest and penalties. To avoid these additional costs, it’s important to make sure you pay your FBT liability on time.

Keep Records

Finally, it’s important to keep records of all your FBT transactions. This includes details of all the fringe benefits you’ve provided to your employees, the taxable value of each benefit, and the FBT rate applicable to each benefit. You should also keep records of any exemptions or concessions that apply to your FBT liability. These records will be important if the ATO audits your business in the future.

Conclusion 

Finally, filing your FBT return and paying for it doesn’t have to be a difficult task. You may remain ahead of the game and prevent any fines or interest charges by being aware of your FBT requirements, calculating your FBT liability, reporting your FBT obligations, paying your FBT liabilities, and maintaining proper records.

A qualified tax agent who can offer you professional assistance is always a good option to speak with if you’re still uncertain about any part of filing your FBT return and paying for it.