Taxation Laws Amendment (FBT Cost of Compliance) Act 1995 (145 of 1995)

Schedule 4   AMENDMENTS OF THE FRINGE BENEFITS TAX ASSESSMENT ACT 1986 RELATED TO DECLARATIONS

7   After section 152

Insert:

Recurring fringe benefit declaration

Recipient may make recurring fringe benefit declaration

"152A.(1) If a person is provided with a benefit (the declaration

benefit), the person may make a recurring fringe benefit declaration in

relation to the declaration benefit.

Expense payment fringe benefits covered by declaration

"(2) If the recurring fringe benefit declaration covers another

benefit (the later benefit) that is an expense payment fringe benefit:

(a) the recurring fringe benefit declaration is taken to have been

made under paragraph 24(1)(e) in respect of the recipients expenditure

for that benefit; and

(b) the gross deduction in subparagraph 24(1)(b)(iii) in relation to

the later benefit is taken to be the amount worked out using the

formula:

Gross expenditure (later benefit) X Deductible proportion of

declaration benefit

where:

Gross expenditure (later benefit) is the gross expenditure mentioned in

paragraph 24(1)(b) in relation to the later benefit.

Deductible proportion of declaration benefit is the deductible

proportion of the declaration benefit as worked out under subsection

(9).

Note: The gross deduction is used as component GD in the formula in

paragraph 24(1)(ba).

Property fringe benefits covered by declaration

"(3) If the recurring fringe benefit declaration covers another

benefit (the later benefit) that is a property fringe benefit:

(a) the recurring fringe benefit declaration is taken to have been

made under paragraph 44(1)(c) in respect of the recipients property for

that benefit; and

(b) the gross deduction in subparagraph 44(1)(b)(i) in relation to

the later benefit is taken to be the amount worked out using the

formula:

Gross expenditure (later benefit) X Deductible proportion of

declaration benefit

where:

Gross expenditure (later benefit) is the gross expenditure mentioned in

paragraph 44(1)(b) in relation to the later benefit.

Deductible proportion of declaration benefit is the deductible

proportion of the declaration as worked out under subsection (9).

Note: The gross deduction is used as component GD in the formula in

paragraph 44(1)(ba).

Residual fringe benefits covered by declaration

"(4) If the recurring fringe benefit declaration covers another

benefit (the later benefit) that is a residual fringe benefit:

(a) the recurring fringe benefit declaration is taken to have been

made under paragraph 52(1)(c) in respect of the recipients benefit for

that benefit; and

(b) the gross deduction in subparagraph 52(1)(b)(i) in relation to

the later benefit is taken to be the amount worked out using the

formula:

Gross expenditure (later benefit) X Deductible proportion of

declaration benefit

where:

Gross expenditure (later benefit) is the gross expenditure mentioned in

paragraph 52(1)(b) in relation to the later benefit.

Deductible proportion of declaration benefit is the deductible

proportion of the declaration benefit as worked out under subsection

(9).

Note: The gross deduction is used as component GD in the formula in

paragraph 52(1)(ba).

"(5) The declaration must be in a form approved in writing by the

Commissioner and be made, and given to the employer, by the declaration

date for the employer for the FBT year in which the declaration benefit

is provided.

What benefit declaration covers

"(6) The declaration covers all benefits that are identical to the

declaration benefit received by the person before the earlier of:

(a) the time when the person revokes the declaration; and

(b) the end of 5 years starting when the declaration is made.

"(7) The declaration does not cover a benefit if the deductible

proportion of the benefit is more than 10 percentage points less than

the deductible proportion of the declaration benefit.

"(8) If a taxpayer makes a declaration for a benefit that is an

identical benefit to a benefit covered by an earlier declaration, the

earlier declaration is revoked.

Meaning of deductible proportion

"(9) The deductible proportion of a benefit is the percentage worked

out using the formula:

Gross Deduction X 100%

Gross Expenditure

where:

gross deduction means the gross deduction mentioned in whichever of

subparagraph 24(1)(b)(iii), 44(1)(b)(i) or 52(1)(b)(i) applied to the

benefit.

gross expenditure means the gross expenditure mentioned in whichever of

paragraph 24(1)(b), 44(1)(b) or 52(1)(b) applied to the benefit.".

Meaning of identical

"(10) A benefit is identical to another benefit if the benefits are

the same in all respects except for any differences:

(a) that are minimal or insignificant; or

(b) that relate to the value of the benefits; or

(c) in the deductible proportion of the benefits.".