Save
How can I minimise my Christmas tax burden?
While Santa Claus is making his rounds during the festive season, don’t forget that so is the taxman.
How can I minimise my Christmas tax burden?
While Santa Claus is making his rounds during the festive season, don’t forget that so is the taxman.
Hosting an office or client Christmas party requires planning and it is important to understand the fringe benefits tax (FBT) implications. Appropriate planning may eliminate the FBT burden entirely.
Business premises
If Christmas parties are held on the business premises on a normal work day, expenses such as food and drinks are exempt from FBT, regardless of the amount. However, no income tax deduction is available for such expenses nor are GST input credits allowable.
If family members of employees attend and the total cost (per family) is under $300, again FBT will not apply, and no tax deduction and GST input tax credits will be allowable.
If the total cost per family is above $300, FBT will apply. However, an income tax deduction and GST input tax credits will be allowable.
FBT exemption
Under the FBT legislation, a minor benefit exemption is available if the benefit provided is less than $300 per employee and is provided on an irregular basis. The hosting of a Christmas party is considered an irregular event and, as long as the cost per employee is below $300, the minor benefit exemption can be used to eliminate any FBT implications.
Clients
There are no FBT implications on the portion of expenses that relate to clients, regardless of the location of the Christmas party. As such, no income tax deduction and no GST input tax credits can be claimed for the client’s portion of the Christmas party expenses.
Christmas gifts
Many employers like to give gifts to their employees during the festive season, but these may attract FBT depending on whether they qualify as entertainment or non-entertainment gifts.
Entertainment gifts include items such as tickets to live concerts and movies. Non-entertainment gifts include gift hampers, vouchers, flowers and bottles of wine.
Daryl Jones, senior tax consultant, HLB Mann Judd Brisbane
Tax saving
Why fast-tracking tax cuts won’t stimulate the economy
Treasurer Josh Frydenberg has flagged that previously legislated tax cuts could be moved forward in a bid to help stimulate the Australian economy. ...Read more
Tax saving
Last-minute items to check off before 30 June
With the end of the financial year almost here, an accounting firm has outlined key changes with tax returns this year and flagged some last-minute tax strategies to consider before 30 June. ...Read more
Tax saving
Australia’s richest owe the Tax Office $772m
Australia’s elites and private companies fell $772 million in taxes due to miscalculations and deliberate tax avoidance, the Australian Taxation Office has revealed. ...Read more
Tax saving
Do you have to pay taxes on a trust?
Trusts are usually set up for business, estate planning and investment purposes to separate the legal and beneficial ownership of assets held within the structure. ...Read more
Tax saving
Government rebuffs regional allowance and tax concession reform
A review’s findings into the viability of area tax concessions and payments for regional and remote Australians has had its recommendations shut down by the same government who requested the report...Read more
Tax saving
Penalties for tax fraud in Australia
Public taxes are used to fund government projects in relation to health, defence, infrastructure and many other national and local projects that require public funding. ...Read more
Tax saving
Disaster relief payments receive tax-exempt status
The Australian government has made disaster relief payments to bushfire-affected individuals and businesses tax-exempt while extending tax-free financial support to NSW Rural Fire Service volunteers. ...Read more
Tax saving
Are your franking credits working?
Here’s what you need to know about franking credits and how they work. ...Read more
Tax saving
Why fast-tracking tax cuts won’t stimulate the economy
Treasurer Josh Frydenberg has flagged that previously legislated tax cuts could be moved forward in a bid to help stimulate the Australian economy. ...Read more
Tax saving
Last-minute items to check off before 30 June
With the end of the financial year almost here, an accounting firm has outlined key changes with tax returns this year and flagged some last-minute tax strategies to consider before 30 June. ...Read more
Tax saving
Australia’s richest owe the Tax Office $772m
Australia’s elites and private companies fell $772 million in taxes due to miscalculations and deliberate tax avoidance, the Australian Taxation Office has revealed. ...Read more
Tax saving
Do you have to pay taxes on a trust?
Trusts are usually set up for business, estate planning and investment purposes to separate the legal and beneficial ownership of assets held within the structure. ...Read more
Tax saving
Government rebuffs regional allowance and tax concession reform
A review’s findings into the viability of area tax concessions and payments for regional and remote Australians has had its recommendations shut down by the same government who requested the report...Read more
Tax saving
Penalties for tax fraud in Australia
Public taxes are used to fund government projects in relation to health, defence, infrastructure and many other national and local projects that require public funding. ...Read more
Tax saving
Disaster relief payments receive tax-exempt status
The Australian government has made disaster relief payments to bushfire-affected individuals and businesses tax-exempt while extending tax-free financial support to NSW Rural Fire Service volunteers. ...Read more
Tax saving
Are your franking credits working?
Here’s what you need to know about franking credits and how they work. ...Read more
More articles
Website Notifications
Get notifications in real-time for staying up to date with content that matters to you.
