With the fringe benefits tax (FBT) year ending 31 March 2017, now is the time for business owners to get their FBT affairs sorted.
When calculating FBT liability, employers must gross-up the taxable value of benefits provided to reflect the gross salary employees would need to earn at the highest marginal tax rate (including Medicare levy) to buy the benefits after paying tax.
To calculate fringe benefits taxable amounts, employers must use two separate gross-up rates:
Type 1: Higher gross-up rate is used where employers (or other benefit providers) are entitled to a GST credit for GST paid on benefits provided to an employee. The type 1 gross-up rate for year ending 31 March 2017 is 2.1463.
Type 2: Lower gross-up rate is used where there is no entitlement to a GST credit. The type 2 gross-up rate for year ending 31 March 2017 is 1.9608.
The FBT rate for the year ending 31 March 2017 is 49 per cent.
Whether the benefits provided to the employee are type 1 or type 2, only the lower gross-up rate is used for reporting on employees’ payment summaries.
If you’re not close to retiring, you may not be thinking about your super or where it is. Even if you are a way off from retiring, you should be keeping track of where your super has gone. $17.5 billion of super was lost in 2017-18, $420 million down from the previous year. If you are not paying attention to your super contributions, accounts and insurances, you may have lost super. You may also have unintentionally lost track of super if you have ever changed your name, address, job or lived overseas.
It is not uncommon for people to have multiple super accounts they have acquired over the years of working at different companies. Having multiple unused accounts can result in high fees that drain your untouched super or you could lose track of it completely. It is in your best interest to consolidate all super into one account that suits your retirement goals. When closing unused accounts, you should be mindful of any termination fees, insurance policies, investment options, and ongoing service fees.
If you have lost track of your super it may be held by either your super fund as a lost account or as an ATO-held account. The easiest way to consolidate super is through the myGov website, linking the ATO to records of your super funds
