No More FBT for Salary Sacraficed Donations

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No More FBT for Salary Sacraficed Donations

Are you?	- An employer or employee under a salary-sacrifice arrangement for donations?
At a glance:	- The Government recently announced amendments to Fringe Benefits Tax (FBT) law to ensure that eligible donations made under salary sacrifice arrangements do not attract an FBT liability.
You should:	- Be aware that salary sacrificed donations are not subject to FBT. - Contact us if you require any clarification or advice

1.	In the May Federal Budget, the Government announced that changes would be made to the FBT Act to ensure that donations to Deductible Gift Recipients made under salary sacrificed arrangements do not result in an employer incurring an FBT liability from the 2008/09 FBT year onwards.
2.	These amendments have now been made law and apply retrospectively.
3.	Employees who make salary sacrificed donations are not entitled to claim a deduction for the donations in their own tax return.
4.	Given that the legislation applies retrospectively, the Tax Office has issued the following guidance: • If a taxpayer has already lodged their 2009 FBT return in accordance with previous law, they must seek an amendment to their return. Interest will be paid on any refund received as a result of an overpayment of FBT. • If the taxpayer chose to anticipate the changes to the law and did so correctly, they do not need to take any further action. • If the taxpayer chose to anticipate the changes to the law and did not do so correctly, they must amend the return and report the correct FBT liability.
5.	For more information about the changes, click here or visit the ATO website at http://www.ato.gov.au