Calendar year-end FBT consideration - workplace celebrations

Here are some practical points for you to consider regarding staff parties, recreational activities and employee gifts which may attract fringe benefits tax (FBT).

As the end of the year approaches, many employers celebrate with staff parties, events and gifts to recognise and reward their employees.

As an employer prepares for their end-of-year workplace celebrations, it's a timely opportunity to remind you of your FBT obligations.

Help you assess whether the benefits you provide attract FBT. This will depend on:

• the amount spent on each employee

• the type of benefit provided

• when and where the event is held

• who attends the event.

When FBT may not apply

In certain circumstances employers who hold workplace celebrations or provide staff with gifts may be exempt from FBT. This can include, but is not limited to when they provide:

• food and drink to current employees that is a property benefit, and is consumed on the business premises, on a working day

• food and drink to employees or associates (such as partners) off the business premises which cost less than $300 per person and meets the other requirements of a minor benefit

• infrequent gifts to employees with a value of less than $300 per person and meets the other requirements of a minor benefit

• recreational activities (such as a golf day) which cost less than $300 per person and meets the other requirements of a minor benefit

• benefits provided to business clients are not subject to FBT.

Remind you to keep correct records to ensure compliance and avoid any unexpected penalties.

See ATO website for more information about entertainment-related fringe benefits.

Source: Help your clients navigate FBT and workplace celebrations | Australian Taxation Office