Some Ways To Reduce FBT to Nil.
FBT or Fringe Benefits Tax is a tax on remuneration to employees (can include the business owner) that is paid in forms other than cash (cash meaning also direct deposit to the employees bank account).
If the employee is paid in cash and other forms (eg reimbursement of expenses before tax) this is commonly referred to as salary packaging.
There are some ways that you can package a salary to reduce the FBT to nil.
For Example:
Superannuation
Pay the employees expenses directly only on items that are specifically exempt from FBT eg One laptop computer per year.
Payments that are otherwise deductible. In other words if the employee could have claimed a tax deduction in their personl tax return then there is no FBT if the employer pays for theses expenese instead.
Employee Contributions. The employee pays money to the employer to reduce to nil the employers liability to pay FBT. This is effective where the employees marginal tax rate is below the highest marginal rate.
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