Item 23 Fringe benefit categories

This section details each type of fringe benefit to help you complete item 23:

• A – Cars using the statutory formula
• B – Cars using the operating cost method
• C – Loans granted
• D – Debt waiver
• E – Expense payments
• F – Housing – units of accommodation provided
• G – Employees receiving living-away-from-home allowance (show total paid including exempt components)
• J – Board
• K – Property
• L – Income tax exempt body – entertainment
• M – Other benefits (residual)
• N – Car parking
• P – Meal entertainment

Make sure you don't include the gross-up calculation in the amounts you show at this item.

There are specific valuation rules for each fringe benefit category. Before you can calculate the taxable value of any benefit and complete the details in the 'Taxable value of benefits' column, you must identify the category of the benefit you provided and do the appropriate calculations.

See also  

• Fringe benefits tax – a guide for employers

A – Cars using the statutory formula

Car fringe benefits commonly arise when you make a car you 'hold' available for an employee's private use.

You can calculate the taxable value of a car fringe benefit using either the statutory formula method or operating cost method.

You must use the statutory formula method unless you elect to use the operating cost method. However, if you've not kept the required documentation for the operating cost method (such as logbooks), you can't reduce the taxable value for any business use of the car. You can choose whichever method results in the lowest taxable value, regardless of which method you used in a previous year.

Determining the statutory percentage

You can reduce the base value of a car by one-third for the year ending 31 March 2021 if you owned or leased the car in the year ending 31 March 2016. The reduction applies only once for a particular car and you then use the reduced base value for subsequent years.

A flat statutory rate of 20% applies, regardless of the distance travelled, to all car fringe benefits you provide from 1 April 2014 (except where there is a pre-existing commitment in place before 7.30pm AEST on 10 May 2011 to provide a car).

Statutory percentages for car fringe benefits provided if you have a pre-existing commitment in place before 7.30pm AEST 10 May 2011 to provide the car after this time, are available in chapter 7.4 of Fringe benefits tax – a guide for employers.

How to complete item 23A

Number

• Write the number of cars you used to provide the car fringe benefits using the statutory formula method.
• Don't write the total number of car fringe benefits provided.

Gross taxable value (a)

• Write the sum of the gross taxable values of the car fringe benefits calculated using the statutory formula method, before any reductions (for example, employee contributions).
• Show the amounts before any gross-up calculation. Don't use grossed-up amounts.
• Use GST-inclusive amounts where applicable.
• If there are no employee contributions, copy the gross taxable value figure to the far right-hand column (Taxable value of benefits (a) − (b) − (c)).

Employee contribution (b)

• Write the sum of all employee contributions made toward car fringe benefits provided where the statutory formula method has been used.
• Employee contributions include     
  • amounts the employee pays directly to you for using a car
  • any car operating costs (for example, fuel) the employee paid without reimbursement by you.
   
• Don't include employee contributions that will be made after this return has been lodged, unless the contribution is made by journal entry in your accounts.
• Don't use any excess employee contributions for one benefit type to reduce the taxable value of other benefits you provided to that employee or other employees.

Value of reductions (c)

• Leave this field blank.

Taxable value of benefits (a) − (b) − (c)

• Write the sum of the taxable values of car fringe benefits provided valued using the statutory formula method – that is (a) − (b).
• If the total of the employee contributions received are greater than the gross taxable value of benefits provided, show zero here. Don't show a negative number.

B – Cars using the operating cost method

You must use the statutory formula method unless you elect to use the operating cost method. However, if you've not kept the required documentation for the operating cost method (such as logbooks), you can't reduce the taxable value for any business use of the car. You can choose whichever method results in the lowest taxable value, regardless of which method you used in a previous year.

How to complete item 23B

Number

• Write the number of cars you used to provide the car fringe benefits using the operating cost method.
• Don't write the total number of car fringe benefits provided.

Gross taxable value (a)

• Write the sum of the gross taxable values of the car fringe benefits calculated using the operating cost method, before any reductions (for example, employee contributions).
• Show the amounts before any gross-up calculation. Don't use grossed-up amounts.
• Use GST-inclusive amounts where applicable.
• If there are no employee contributions, copy the gross taxable value figure to the far right-hand column (Taxable value of benefits (a) − (b) − (c)).

Employee contributions (b)

• Write the sum of all employee contributions made toward car fringe benefits provided where the operating cost method has been used.
• Employee contributions include     
  • amounts the employee pays directly to you for using a car
  • any car operating costs (for example, fuel) the employee paid without reimbursement by you.
   
• Don't include employee contributions that will be made after this return has been lodged, unless the contribution is made by journal entry in your accounts.
• Don't use any excess employee contributions for one benefit type to reduce the taxable value of other benefits you provided to that employee or other employees.

Value of reductions (c)

• Leave this field blank – it should not be completed.

Taxable value of benefits (a) − (b) − (c)

• Write the sum of the taxable values of car fringe benefits provided valued using the operating cost method. That is (a) - (b).
• If the total of the employee contributions received are greater than the gross taxable value of benefits provided, show zero here.
• If the amount at employee contributions (b) is greater than the gross taxable value (a), show zero. Don't show a negative number.

C – Loans granted

A loan fringe benefit arises where you provide a loan to an employee and charge a low rate of interest (or no interest).

How to complete item 23C

Number

• Write the number of loans you made that gave rise to taxable fringe benefits.
• Don't write the total number of loan fringe benefits provided.

Gross taxable value (a)

• Write the sum of the gross taxable values of the loan fringe benefits, before any reductions (for example, because of the otherwise deductible rule).
• Show the amounts before any gross-up calculation. Don't use grossed-up amounts.
• If there are no reductions, copy the gross taxable value figure to the far right hand column (Taxable value of benefits (a) − (b) − (c)).

Employee contributions (b)

• Leave this field blank – it should not be completed.

Value of reductions (c)

• Write at (c) the total amount of reductions in the taxable value of loan fringe benefits provided. The taxable value may have been reduced under the otherwise deductible rule.
• Don’t use the otherwise deductible rule unless both of the following apply:          
  • the recipients of the benefits are current employees
  • you obtain from employees, before your return is due or by 21 May 2021, any supporting documents (for example, employee declaration).
   

Taxable value of benefits (a) − (b) − (c)

• Write the sum of the taxable values of loan fringe benefits provided. That is, (a) − (c).
• If the total of the reductions (c) are greater than the gross taxable value of benefits provided (a), show zero here. Don't show a negative number.

See also  

• Fringe benefits tax – rates and thresholds (for the statutory or benchmark interest rates to calculate the taxable value)

D – Debt waiver

If an employee is in debt to you and you release the employee from the obligation to repay the debt, the unpaid amount is a debt waiver fringe benefit.

How to complete item 23D

Number

• Leave this field blank – it should not be completed.

Gross taxable value (a)

• Write the sum of the gross taxable values of the debt waiver fringe benefits. That is, the amount of debt that you waived.
• Show the amounts before any gross-up calculation. Don't use grossed-up amounts.
• There are no employee contributions or reductions, so copy the gross taxable value figure to the far right-hand column (Taxable value of benefits (a) − (b) − (c)).
• Don't include amounts that you write off as a genuine bad debt. A debt owed by an employee that you write-off as a genuine bad debt is not a debt waiver fringe benefit.

Employee contributions (b)

• Leave this field blank – it should not be completed.

Value of reductions (c)

• Leave this field blank because it should not be completed. There are no other reductions that can apply in respect of debt waiver fringe benefits.

Taxable value of benefits (a) − (b) − (c)

• Write the same figure that was written at 'Gross taxable value (a)' in this column. Don't input a different figure.

E – Expense payments

An expense payment fringe benefit may arise in either of two ways:

• where you (the employer) reimburse an employee for expenses they incur
• where you pay a third party in satisfaction of expenses incurred by an employee.

How to complete item 23E

Number

• Leave this field blank – it should not be completed.

Gross taxable value (a)

• Write the sum of the gross taxable values of the expense payment fringe benefits before any reductions (for example, the otherwise deductible rule).
• Show the amounts before any gross-up calculation. Don't show grossed-up amounts.
• Use GST inclusive amounts where applicable.
• If there are no employee contributions or reductions, copy the gross taxable value figure to the far right-hand column (Taxable value of benefits (a) − (b) − (c)).

Employee contributions (b)

• Write the sum of all employee contributions made toward expense payment fringe benefits provided.
• Don't include employee contributions that will be made after this return has been lodged, unless the contribution is made by journal entry in your accounts.
• Don't use any excess employee contributions for one benefit type to reduce the taxable value of other benefits you provided to that employee or other employees.

Value of reductions (c)

• Write at (c) the total amount of reductions in the taxable value of expense payment fringe benefits provided. The taxable value may have been reduced:          
  • under the otherwise deductible rule
  • by other means (for example, in relation to in-house benefits).
   
• The 'otherwise deductible rule' only applies if both of the following apply:          
  • the recipients of the benefits are current employees
  • you obtain from employees, before your return is due or by 21 May 2021, any supporting documents (for example, employee declaration).
   

Taxable value of benefits (a) − (b) − (c)

• Write the sum of the taxable values expense payment fringe benefits provided. That is (a) − (b) − (c).
• If the total of the employee contributions (b) and reductions (c) are greater than the gross taxable value of benefits provided (a), show zero here. Don't write a negative number.

F – Housing – units of accommodation provided

A housing fringe benefit is when an employee is provided with the right to use a unit of accommodation. A lease, or licence, which grants that right must exist when that accommodation is the usual place of residence of the employee.

How to complete Label 23F

Number

• Write the number of units of accommodation used to provide the housing fringe benefits. Don't write the total number of housing fringe benefits provided.
• Don't include housing benefits provided in a remote area that are exempt from FBT. Exempt benefits are not included on the FBT return.
• Don't include other accommodation provided that does not meet the requirements of a housing fringe benefit. Providing this type of accommodation is a residual fringe benefit and is shown at 'M Other benefits (residual)'.

Gross taxable value (a)

• Write the sum of the taxable values of the expense payment fringe benefits before any employee contributions.
• Show the amounts before any gross-up calculation. Don't show grossed-up amounts.
• If there are no employee contributions, copy the gross taxable value figure to the far right-hand column (Taxable value of benefits (a) − (b) − (c)).

Employee contributions (b)

• Write the sum of all employee contributions made toward housing fringe benefits provided.
• Don't include employee contributions that will be made after this return has been lodged, unless the contribution is made by journal entry in your accounts.
• Don't use any excess employee contributions for one benefit type to reduce the taxable value of other benefits you provided to that employee or other employees.

Value of reductions (c)

• Leave this field blank – don't write anything in this field.

Taxable value of benefits (a) − (b) − (c)

• Write the sum of the taxable values of housing fringe benefits provided. That is (a) − (b).
• If the total of the employee contributions (b) are greater than the gross taxable value of benefits provided (a), show zero here. Don't write a negative number.

G – Employees receiving living-away-from-home allowance (show total paid including exempt components)

A living-away-from-home-allowance is paid to your employee to compensate for additional expenses and any disadvantages suffered because the employee's duties of employment require them to live away from their normal residence.

How to complete Label 23G

Number

• Write the number of employees who received a living-away-from-home allowance. Don't write the total number of living-away-from-home allowance fringe benefits provided.

Gross taxable value (a)

• Write the sum of the taxable values of the living-away-from-home allowance fringe benefits before any reductions.
• The total amounts shown should include the exempt accommodation component, exempt food component and the statutory food amount. The statutory food amount is the amount your employees would spend on food at their normal residence – it is set at $42 per week per adult, and $21 per week per child under 12.
• The amounts shown should be the amounts before any gross-up calculation. Don't use grossed-up amounts.
• If there are no reductions, include the gross taxable value figure (a) in the 'Taxable value of benefits (a) − (b) − (c)' column.

Employee contributions (b)

• Leave this column blank. Employee contributions can't be provided in respect of a living-away-from-home allowance fringe benefit under the FBT law.

Value of reductions (c)

• Write at (c) the total amount of reductions in the taxable value of living-away-from-home allowance fringe benefits. The exempt accommodation and exempt food components should be included at (c).
• Don't include at (c) any exempt accommodation and exempt food components more than the Commissioner of Taxation's reasonable amount unless you have the necessary documentary evidence or declaration of employee expenses and the declaration about living away from home.

Taxable value of benefits (a) − (b) − (c)

• Write the sum of the taxable values of living-away-from-home allowance fringe benefits provided. That is (a) − (c).
• If the total of the reductions (c) are greater than the gross taxable value of benefits provided (a), show zero here. Don't show a negative number.

See also  

• Living-away-from-home allowance fringe benefits
• Living-away-from-home declarations
• Fringe benefits tax – rates and thresholds (for the Commissioner's reasonable food and drink amounts)

J – Board

Meals you provide an employee and family members living with the employee may be a board fringe benefit if:

• you provide an employee with accommodation
• the employee has an entitlement to at least two meals a day prepared and supplied by you on your premises.

How to complete Label 23J

Number

• Leave this field blank – it should not be completed.

Gross taxable value (a)

• Write the sum of the gross taxable values of the board fringe benefits provided.
• The amounts shown should be amounts before any gross-up calculation. Don't use grossed-up amounts.
• Include board meals provided where you contract an employee's services to another person who provides the employee with board meals on their premises. The meals in this case are board fringe benefits and you still have the FBT liability.
• If there are no employee contributions (b) or reductions (c), write the gross taxable value figure (a) in the 'Taxable value of benefits (a) − (b) − (c)' column.
• Don't include board meals provided to an employee in a primary production business located in a remote area. These are exempt benefits and are not included in the FBT return.
• 'Don't include at this item:    
  • meals provided at a party, reception or other social function
  • meals provided in a dining facility open to the public (except for board meals provided to employees of a restaurant, motel, hotel, etc)
  • meals provided in a facility mainly used by a particular employee.
   

These aren't board fringe benefits. However, they may be property fringe benefits, tax-exempt body entertainment fringe benefits, or meal entertainment fringe benefits.

Employee contributions (b)

• Write the sum of all employee contributions made toward board fringe benefits provided.
• Don't include employee contributions that will be made after this return has been lodged, unless the contribution is made by journal entry in your accounts.
• Don't use any excess employee contributions for one benefit type to reduce the taxable value of other benefits you provided to that employee or other employees.

Value of reductions (c)

Write the sum of all reductions that apply to board fringe benefits provided.

The taxable value of the board fringe benefit is reduced to nil if both of the following apply:

• you provide a board fringe benefit to an employee
• they would have been entitled to an income tax deduction if they had paid for the meal.

Don't apply the 'otherwise deductible rule' unless both of the following apply:

• the recipients of the benefits are current employees
• you obtain from employees, before your return is due or by the 21 May 2021, any supporting documents (for example, employee declaration).

Taxable value of benefits (a) − (b) − (c)

• Write the sum of the taxable values of board fringe benefits provided. That is (a) − (b) − (c).
• If the total of the employee contributions (b) and reductions (c) are greater than the gross taxable value of benefits provided (a), show zero here. Don't show a negative value.

K – Property

You may provide a property fringe benefit when you provide an employee with property (for example, goods), either free or at a discount.

How to complete Label 23K

Number

• Leave this field blank – it should not be completed.

Gross taxable value (a)

• Write the sum of the gross taxable values of the property fringe benefits.
• The amounts shown should be amounts before any gross-up calculations. Don't use grossed-up amounts.
• Use GST-inclusive amounts where applicable.
• If there are no employee contributions (b) or reductions (c), copy the gross taxable value figure (a) to the 'Taxable value of benefits (a) − (b) − (c)' column.

Employee contributions (b)

• Write the sum of all employee contributions made toward property fringe benefits provided.
• Don't include employee contributions that will be made after this return has been lodged, unless the contribution is made by journal entry in your accounts.
• Don't use any excess employee contributions for one benefit type to reduce the taxable value of other benefits you provided to that employee or other employees.

Value of reductions (c)

• Write at (c) the total amount of reductions in the taxable value of property fringe benefits provided. The taxable value may have been reduced:          
  • under the otherwise deductible rule
  • by other means – for example, in relation to in-house fringe benefits.
   
• The 'otherwise deductible rule' only applies if both of the following apply:          
  • the recipients of the benefits are current employees
  • you obtain from employees, before your return is due or by the 21 May 2021, any supporting documents (for example, employee declarations, receipts or invoices).
   

Taxable value of benefits (a) − (b) − (c)

• Write the sum of the taxable values of property fringe benefits provided. That is (a) − (b) − (c).
• If the total of the employee contributions (b) and reductions (c) are greater than the gross taxable value of benefits provided (a), show zero here. Don't write a negative number.

L – Income tax exempt body – entertainment

A tax-exempt body entertainment fringe benefit may arise from entertainment expenses incurred by you if any of the following apply:

• you are wholly exempt from income tax – for example, a club that earns income from members only
• you are partially exempt from income tax – for example, a club that earns income from both members and non-members
• you did not get assessable income from the activities to which the entertainment relates.

How to complete Label 23L

Number

• Leave this column blank – it should not be completed.

Gross taxable value (a)

• Write the sum of the gross taxable values of the tax-exempt body entertainment fringe benefits.
• The amounts shown should be amounts before any gross-up calculation. Don't use grossed-up amounts.
• Use GST-inclusive amounts where applicable.
• Include tax-exempt body entertainment provided under a salary sacrifice arrangement at this item – you can't choose to value it as a meal entertainment fringe benefit.
• Copy the gross taxable value figure to the far right-hand column (Taxable value of benefits (a) − (b) − (c)).
• Don't include meal and entertainment facility leasing expense benefits not provided under a salary sacrifice arrangement at this item if you are a not-for-profit employer, who is eligible for the FBT capping exemption or FBT rebate. These employers do not need to disclose meal and entertainment facility leasing expense benefits not provided under a salary packaging arrangement at item 23.
• If you have chosen to value food and drink that is tax-exempt body entertainment using the meal entertainment valuation rules, don't include them here. Include these benefits under 'P Meal entertainment'.
• If you are not exempt from income tax and you provided entertainment, don't complete this item. Instead, establish the taxable value as an expense payment, property or residual fringe benefit, depending on how you provided the benefit. Alternatively, you can value meal entertainment as a meal entertainment fringe benefit.

Employee contributions (b)

Leave this field blank. Employee contributions can't be provided in respect of a tax-exempt body fringe benefit under FBT law.

Value of reductions (c)

• Leave this field blank. There are no reductions in respect of tax-exempt body entertainment fringe benefits under FBT law.

Taxable value of benefits (a) − (b) − (c)

• Write the same figure as at 'Gross taxable value (a)' in this column. Don't use a different figure.

M – Other benefits (residual)

You may provide a residual fringe benefit when you provide an employee with either of the following:

• any right, privilege, service or facility
• any other benefit that is not one of the specific categories of fringe benefits included at other categories in item 23.

How to complete Label 23M

Number

• Leave this field blank – it should not be completed.

Gross taxable value (a)

• Write the sum of the gross taxable values of the residual fringe benefits.
• The amounts shown should be amounts before any gross-up calculation. Don't use grossed-up amounts.
• Use GST-inclusive amounts where applicable.
• If you choose to value entertainment facility leasing expense benefits not provided under a salary packaging arrangement under the 50-50 method, you must include the value of these benefits at this item.
• If there are no employee contributions (b) or reductions (c), copy the gross taxable value figure (a) to the 'Taxable value of benefits (a) − (b) − (c)' column.

Employee contributions (b)

• Write the sum of all employee contributions made for residual fringe benefits.
• Don't include employee contributions that will be made after this return has been lodged, unless the contribution is made by journal entry in your accounts.
• Don't use any excess employee contributions for one benefit type to reduce the taxable value of other benefits you provided to that employee or other employees.

Value of reductions (c)

• Write at (c) the total amount of reductions in the taxable value of residual fringe benefits provided. The taxable value may have been reduced:       
  • under the otherwise deductible rule
  • by other means – for example, in relation to in-house fringe benefits.
   
• Don't reduce the value using the otherwise deductible rule unless both of the following apply:       
  • the recipients of the benefits are current employees
  • you obtain from employees, before your return is due or by 21 May 2021, any supporting documents (for example, employee declarations, receipts or invoices).
   

Taxable value of benefits (a) − (b) − (c)

• Write the sum of the taxable values of the residual fringe benefits provided. That is (a) − (b) − (c). If the total of the employee contributions (b) and reductions (c) are greater than the gross taxable value of benefits provided (a), show zero here. Don't write a negative number here.

N – Car parking

A car parking fringe benefit may arise for each day on which you provide a car parking space for use by an employee.

How to complete Label 23N

Number

• Leave this field blank – it should not be completed.

Gross taxable value (a)

• Write the sum of the gross taxable values of the car parking fringe benefits.
• The amounts shown should be amounts before any gross-up calculation. Don't use grossed-up amounts.
• Use GST-inclusive amounts where applicable.
• If there are no employee contributions (b) copy the gross taxable value figure (a) to the 'Taxable value of benefits (a) − (b) − (c)' column.

Employee contributions (b)

• Write the sum of all employee contributions made for car parking fringe benefits.
• Don't include employee contributions that will be made after this return has been lodged, unless the contribution is made by journal entry in your accounts.
• Don't use any excess employee contributions for one benefit type to reduce the taxable value of other benefits you provided to that employee or other employees.

Value of reductions (c)

• Leave this field blank. There are no reductions that can apply for car parking fringe benefits.

Taxable value of benefits (a) − (b) − (c)

• Write the sum of the taxable values of the car parking fringe benefits provided. That is (a) − (b).
• If the total of the employee contributions (b) is greater than the gross taxable value of benefits provided (a), show zero here. Don't show a negative number.

See also  

• Car parking fringe benefits

P – Meal entertainment

If expense payment fringe benefits, property fringe benefits, residual fringe benefits or tax-exempt body entertainment fringe benefits arise from the provision of meal entertainment, you may be eligible to classify these fringe benefits as meal entertainment fringe benefits. You are not eligible to make an election if benefits are provided under salary packaging arrangements on, or after, 1 April 2016.

If you choose to classify a fringe benefit as a meal entertainment fringe benefit, you have to classify all fringe benefits arising from the provision of meal entertainment during the year ending 31 March 2021 as meal entertainment fringe benefits.

Specifically, the provision of meal entertainment means:

• providing entertainment by way of food or drink
• providing accommodation or travel in connection with, or to facilitate the provision of, such entertainment
• paying or reimbursing expenses incurred by the employee for the above.

There are two methods you can use to calculate the taxable value of meal entertainment fringe benefits:

• 50-50 split method
• 12-week register method.

You must decide to classify fringe benefits as meal entertainment by 21 May 2021 unless we have allowed you to lodge later.

How to complete Label 23P

Number

• Leave this field blank – it should not be completed.

Gross taxable value (a)

• Write the sum of the gross taxable values of the meal entertainment fringe benefits.
• The amounts shown should be amounts before any gross-up calculation. Don't use grossed-up amounts.
• Use GST-inclusive amounts where applicable.
• Copy the gross taxable value figure (a) to the 'Taxable value of benefits (a) − (b) − (c)' column.
• Don't include meal entertainment benefits not provided under a salary sacrifice arrangement at this item if you are a not-for-profit employer, who is eligible for the FBT capping exemption or FBT rebate. These employers do not need to disclose meal and entertainment facility leasing expense benefits not provided under a salary packaging arrangement at item 23 on the FBT return.
• Don't include entertainment provided under a salary sacrifice arrangement at this item because you can't make the meal entertainment election in this case. The benefits will need to be valued as tax-exempt body, expense payment, property or residual benefits depending on how the benefit was provided.

Employee contributions (b)

• Leave this field blank. Employee contributions can't be provided as a meal entertainment fringe benefit under the FBT law.

Value of reductions (c)

• Leave this field blank. There are no reductions for meal entertainment fringe benefits under the FBT law.

Taxable value of benefits (a) − (b) − (c)

• Write the same figure that was written at 'Gross taxable value (a)' in this column. Don't input a different figure.

See also  

• Chapter 14 – Fringe benefits tax – a guide for employers

Next steps  

• FBT rates and thresholds
• Completing your 2021 FBT return – all employers
• Keeping records for FBT