With the cost increase in Fuel, if a company was to provide a pre paid fuel card for $200, what are the implications, is this FBT is it taxable income, do they get super?
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107 views
1 replies
Hi @davide.wheeler,
Providing a prepaid fuel card for $200 may result in a fringe benefits tax (FBT) liability for your company. Whether FBT applies depends on several factors, including whether the fuel card is used for private purposes and if any exemptions apply.
If the fuel card is for private use by employees, it's likely to be an expense payment fringe benefit or residual fringe benefit, and you'll need to calculate the taxable value and pay FBT on it. However, the minor benefits exemption may apply if the benefit has a notional taxable value of less than $300. For the minor benefits exemption to apply, the benefit must be infrequent and irregular in nature. You should consider each instance on a case-by-case basis, taking into account factors such as frequency and regularity of providing similar benefits.
If FBT applies, you as the employer pay the tax, not the employee. The benefit won't be treated as taxable income to the employee, and superannuation isn't payable on fringe benefits. However, if the total taxable value of fringe benefits provided to an employee exceeds certain thresholds during the FBT year (1 April to 31 March), you'll need to report it as a reportable fringe benefits amount.
Alternatively, you could provide a cash bonus instead of the fuel card. In this case, there's no FBT liability for you, but the employee would pay income tax on the amount and superannuation guarantee would be payable on it.
All replies
Hi @davide.wheeler,
Providing a prepaid fuel card for $200 may result in a fringe benefits tax (FBT) liability for your company. Whether FBT applies depends on several factors, including whether the fuel card is used for private purposes and if any exemptions apply.
If the fuel card is for private use by employees, it's likely to be an expense payment fringe benefit or residual fringe benefit, and you'll need to calculate the taxable value and pay FBT on it. However, the minor benefits exemption may apply if the benefit has a notional taxable value of less than $300. For the minor benefits exemption to apply, the benefit must be infrequent and irregular in nature. You should consider each instance on a case-by-case basis, taking into account factors such as frequency and regularity of providing similar benefits.
If FBT applies, you as the employer pay the tax, not the employee. The benefit won't be treated as taxable income to the employee, and superannuation isn't payable on fringe benefits. However, if the total taxable value of fringe benefits provided to an employee exceeds certain thresholds during the FBT year (1 April to 31 March), you'll need to report it as a reportable fringe benefits amount.
Alternatively, you could provide a cash bonus instead of the fuel card. In this case, there's no FBT liability for you, but the employee would pay income tax on the amount and superannuation guarantee would be payable on it.
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