In the Federal Budget released Tuesday night, the Government has provided further details on the application of the single statutory rate for car fringe benefits provided to employees.
The new measures are more generous than previously anticipated to the extent that the flat rate only applies to new vehicle purchase and lease agreements entered from 10 May 2011 and a transitional period has been implemented for employers.
The 20% flat rate will now be phased in over 4 years as shown by the following table:
As a result of the new measures additional administrative burden will be placed on employers during the 2012 to 2014 FBT years, but the use of the statutory formula method will become simpler thereafter.
Employers will also need to ensure that any new novated leases entered should take into account the above changes to the statutory rate.
This publication is issued by Moore Stephens Australia Pty Limited ACN 062 181 846 (Moore Stephens Australia) exclusively for the general information of clients and staff of Moore Stephens Australia and the clients and staff of all affiliated independent accounting firms (and their related service entities) licensed to operate under the name Moore Stephens within Australia (Australian Member). The material contained in this publication is in the nature of general comment and information only and is not advice. The material should not be relied upon. Moore Stephens Australia, any Australian Member, any related entity of those persons, or any of their officers employees or representatives, will not be liable for any loss or damage arising out of or in connection with the material contained in this publication. Copyright © 2011 Moore Stephens Australia Pty Limited. All rights reserved.
