Will you ute remain FBT free?
Early this year in our we considered the ATO’s new stance on the fringe benefits tax implications of work utes.
This applies if you:
- Provide a ute to your staff
- Own your ute in your trust or company
- Are provided with a ute by your employer
The ATO has finalised its Practical Compliance Guideline (PCG 2018/3) regarding when work utes would be subject to fringe benefits tax.
Utes will now be subject to fringe benefits tax if:
- any home to work travel involves a diversion of more than 2 kilometres or
- you travel more than 1000km for private purposes during the year or
- any private trip you make is in excess of 200km
Should you wish to avoid fringe benefits tax you will need to:
- have a policy which restricts private use of the ute
- obtain assurance from employees that private travel was limited as outlined above
This new compliance measure could have a significant impact on your business, so please chat to your accountant if you have any queries or concerns about this issue.