FBT considerations for employees who worked from home during COVID-19

Fringe Benefits TaxTax

1 April 2021

Now that Fringe Benefits Tax (FBT) year-end is upon us, it’s time to start thinking about the FBT considerations where employees were provided with benefits to support working from home arrangements during the COVID-19 pandemic.

Here is a high-level overview of items you may have supplied your employees to consider.

Laptops and other portable electronic devices

Certain items will generally be exempt from FBT if they are primarily used by employees for work purposes. These items include laptops, portable printers and other portable electronic devices such as tablets and smart phones, but not desktop computers, which the ATO does not consider to be portable electronic devices.

Small businesses with an annual turnover of less than $10 million may be eligible to provide multiple portable electronic devices to an employee, even where the items have substantially identical functions. From 1 April 2021, the turnover threshold for businesses to be eligible for this exemption will increase from $10 million to $50 million.

In addition, the minor benefits exemption or the ‘otherwise deductible’ rule may apply where:

  • An employee is provided with a monitor, mouse or keyboard they otherwise use in the workplace.

  • An employee is provided with stationery or computer consumables or pay for their phone and internet access.

Counselling

Counselling services provided to support an employee's work from home arrangement may be exempt from FBT under the existing rules for work-related counselling.

'Work-related counselling' refers to counselling that seeks to improve or maintain the quality of your employee's work performance and relates to matters such as health and safety, stress management, relationships, retirement, and any other similar matters.

Health care

Health care provided to an employee to support their work from home arrangement may also be exempt from FBT if it is the provision of work-related preventative health care.

'Work-related preventative health care' means any form of care that:

  • Is provided by or on behalf of a legally-qualified medical practitioner, nurse, dentist or optometrist;

  • Has the principal purpose of preventing your employee from suffering from injury or disease that is related to their employment; and

  • Is available to all your employees who are likely to suffer from similar work-related injury or disease.

For assistance with your 2021 FBT return or to talk about any other employment tax issue, please speak to your adviser or get in touch with the Findex Tax Advisory team.

Watch our Fringe Benefits Tax 2021 webinar recording

Are you prepared for your 2021 Fringe Benefits Tax (FBT) return? Do you want to learn more about the current COVID 19 landscape and how it directly affects your business?

Watch our webinar recording with Tax Advisory Partner Anthony Patrkand Associate Partner Chris Heyes, who will help ensure you are up to date with the latest developments (including any COVID 19 considerations) to assist you in preparing your 2021 return.

WATCH NOW

Author: Christopher Heyes

Chris has over 20 years’ experience providing practical advice and compliance services in the various areas of employment tax such as payroll tax, Fringe Benefits Tax (FBT), superannuation guarantee, workers compensation and pay-as-you-go (PAYG) Withholding. Chris has extensive experience working with clients across many areas of tax consulting to manage employment taxes risks and exposure. He has proven this experience across a broad range of industries and client categories including private companies, large corporations, government agencies and family owned businesses. Chris specialises in providing tax effective solutions which also take into account other tax and commercial considerations. My Specialty • Employment Taxes • Global Mobility