You may provide a property fringe benefit when you provide an employee with property (for example, goods), either free or at a discount.
Changes have been made to the FBT law to remove the concessional treatment of in-house property fringe benefits provided under a salary packaging arrangement entered into on or after 22 October 2012. Transitional rules apply where an existing salary packaging arrangement was entered into before 22 October 2012.
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Reform of salary sacrificed 'in-house' fringe benefits
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Example: Calculate property fringe benefits
An electrical retailer provides a television that normally sells for $2,000, and an air conditioner that normally sells for $1,600, to an employee during the FBT year. The employee paid a total of $300 for these items.
The value of the benefit is reduced to 75% of the selling price. Because these items are in-house property fringe benefits, the taxable value is 75% of the normal selling price and the employer qualifies for the in-house concession of up to $1,000 per employee per year.
The retailer calculates the property fringe benefit as follows:
Gross taxable value is $2,700 (($2,000 + $1,600) x 75%)
Value of reduction is $1,000.
The electrical retailer would show this at item 23 as follows: