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Income tax and GST credits - non-entertainment gifts provided to employees costing less than $300

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Hi,

 

If an employer provides its employees some non-entertainment gifts such as gift cards, hampers, bottle of wine etc on a irregular basis and the cost of each gift is less  than $300, can the employer claim income tax deduction and GST credits on the purchase of those gifts?

 

Thank you.

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Hi @charliezhao,

 

Welcome to our Community!

 

Usually where in-house fringe benefits are received, they will attract the Fringe Benefits Tax (FBT) for employers. However, given the circumstances you described in terms of the irregular basis and value of each gift being less than $300 per employee, the employer may qualify for the minor benefits exemption.

 

If they do qualify, it is likely these costs can be treated as deductions along with any GST credits.

 

Thanks, @NelsonS

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Most helpful response

ATO Certified Response

Community Support

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Hi @charliezhao,

 

Welcome to our Community!

 

Usually where in-house fringe benefits are received, they will attract the Fringe Benefits Tax (FBT) for employers. However, given the circumstances you described in terms of the irregular basis and value of each gift being less than $300 per employee, the employer may qualify for the minor benefits exemption.

 

If they do qualify, it is likely these costs can be treated as deductions along with any GST credits.

 

Thanks, @NelsonS