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FBT Year Ends on 31 March
The Fringe Benefits Tax (FBT) year is coming to a close very soon… on the 31st March, in fact. The last thing you want is to realise in early April that you have exceeded the threshold and find yourself with an FBT liability.
Employers are required to perform a self-assessment of your FBT liability and lodge an appropriate return.
We encourage you to review your payroll records now and be prepared to make adjustments if necessary.
Keep under the threshold
Salary sacrifice of fringe benefits can be an effective way for not for profit organisations to boost the salary package of employees and make your salary budget stretch a bit further.
As the FBT liability falls with the employer, it’s important that you make sure the value of your benefits have not exceeded the threshold.
NFP’s finances can be tight at the best of times, so this week is a critical time for reviewing all your arrangements.
Every now and then, a fortnightly payroll calendar will have 27 pays in one year (instead of the regular 26). If that is applicable to you, make sure you stop deductions for that 27th payroll to avoid going over the threshold. Potentially, even a weekly payroll calendar could fall over the threshold. It is always good practice to review payroll and deductions during March so you know whether you can cruise to the end of the FBT year next week or do some quick-fast adjustments to ensure that final payroll doesn’t tip you over the threshold and into an FBT bill.
How can we help?
If you discover that you have exceeded the threshold on some employee benefits, there are solutions available to you. Adjustments can be made to help reduce your liability, but it’s imperative that you act immediately… because the FBT year is almost up!
At Accounting For Good we have a team of highly skilled not for profit accounting specialists. We can help you navigate your FBT obligations. Contact us if you have any questions. Read more not for profit accounting articles.
