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Christmas Celebration May Attract FBT
ACP Team • November 27, 2024
With the holiday season kicking off, you may be planning a celebration with your staff. Consider if fringe benefits tax (FBT) may apply or you could end up with an unexpected FBT liability.
Before you hire a restaurant or book an event, make sure you work out if the benefits you provide your employees are considered entertainment related and if they’ll attract fringe benefits tax (FBT).
This will depend on:
- the amount you spend on each employee
- when and where your celebration is held
- who attends - is it just employees? Or are partners, clients and suppliers also invited?
- the value and type of gifts you provide
If you do provide entertainment-related fringe benefits, keep the right records to support this so you can calculate their taxable value.
It's important to get on top of how FBT works before you provide perks and extras. Otherwise, you may end up with an unexpected FBT liability.
For more information, please contact your Sydney business accountants – ACP Accountants on 02-80467621, or simply get in touch and email us at info@acpaccountants.net.au.
One of the many responsibilities SMSF trustees have every income year is valuing your fund's asset at market value. Each year you need to value your SMSFs assets and provide supporting evidence to your auditor. The market value of an asset is the amount that a willing buyer and seller would agree to in an arms-length transaction. These valuations will be used when preparing your fund's accounts, statements and SMSF annual return (SAR). Your asset valuations will be reviewed by your approved SMSF auditor as part of the annual audit prior to lodgment of your SAR. Your auditor will check that assets have been valued correctly, assess and document whether the basis for the valuations is appropriate given the nature of the asset. They are not responsible for valuing fund assets. Make sure you get your valuations done before going to your auditor. It's your responsibility to provide objective and supportable evidence to your auditor for the valuation of the fund's assets, including all relevant documents requested to prevent delays in auditing the fund. Failure to do so could result in a potential late lodgment of your annual return or a contravention if mistakes have been made. Start researching now to find what type of evidence your need to support the valuation as this can take time. For some asset types the law requires valuations to be undertaken by a qualified independent valuer. For further information, please contact Sydney Business Accountants – ACP Accountants on 02-80467621, or simply email us at info@acpaccountants.net.au.
Two Western Australian directors were recently convicted for failing to have a director ID. Both directors were fined $5,000 in the Perth Magistrates Court on 3 May 2024, for failing to comply with director identification requirements. The maximum penalty for failure to comply is currently a fine of $18,780. The Magistrate stated the director ID service had been enacted for a proper public purpose and considerable efforts had been made by government agencies to bring the accused’s attention to the service and comply. All directors are required to verify their identity with the Australian Business Registry Services (ABRS) and apply for their director ID prior to being appointed as a director. Please note that directors must apply for their director ID themselves. The fastest way is to apply online at ABRS.gov.au. If a director is unable to apply online, you can phone ABRS on 13 62 50. For more information about who needs a director ID and how to apply, visit ABRS.gov.au. If you have any questions, please contact your accountant/tax professionals, or contact us today on 02-8046 7621, your local Sydney business accountants.
2024 tax time is just around the corner. It’s also the time to check if there are any items that you tax deductible and that it could save you quite a bit of time. Finalise your employees' single touch payroll (STP). If you have employees, make sure you finalise their 2023–24 STP information by 14 July. This is an important end-of-year obligation and ensures your employees have the right information they need to lodge their income tax return. Remember to finalise all employees you’ve paid in the financial year, even those you haven’t paid for a while, like terminated employees. Check your pay as you go (PAYG) withholding and instalments From 1 July, individual tax rates and thresholds will change. This will impact your PAYG withholding for the 2025 financial year. Check you're using the correct PAYG withholding tax table and that your payroll software is using the new withholding rates from 1 July. When it comes to your PAYG instalments, if you think these could result in you paying too little or too much tax for the year, you can vary your instalments. You can do this when you lodge your activity statement or instalment notice. Remember to lodge your variation on or before the day your PAYG instalment is due, and before you lodge your tax return for the year. Good record-keeping habits Heading toward the new financial year, think about your record-keeping habits this past year and whether you’d do anything differently. Good record keeping is one of the foundations of running a successful business. If you haven’t already, now is a great time to connect with us – your Sydney business accountants at ACP Accountants. Simple call us on 02-80467621, or send us an email at info@acpaccountants.net.au.
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One of the many responsibilities SMSF trustees have every income year is valuing your fund's asset at market value. Each year you need to value your SMSFs assets and provide supporting evidence to your auditor. The market value of an asset is the amount that a willing buyer and seller would agree to in an arms-length transaction. These valuations will be used when preparing your fund's accounts, statements and SMSF annual return (SAR). Your asset valuations will be reviewed by your approved SMSF auditor as part of the annual audit prior to lodgment of your SAR. Your auditor will check that assets have been valued correctly, assess and document whether the basis for the valuations is appropriate given the nature of the asset. They are not responsible for valuing fund assets. Make sure you get your valuations done before going to your auditor. It's your responsibility to provide objective and supportable evidence to your auditor for the valuation of the fund's assets, including all relevant documents requested to prevent delays in auditing the fund. Failure to do so could result in a potential late lodgment of your annual return or a contravention if mistakes have been made. Start researching now to find what type of evidence your need to support the valuation as this can take time. For some asset types the law requires valuations to be undertaken by a qualified independent valuer. For further information, please contact Sydney Business Accountants – ACP Accountants on 02-80467621, or simply email us at info@acpaccountants.net.au.
Two Western Australian directors were recently convicted for failing to have a director ID. Both directors were fined $5,000 in the Perth Magistrates Court on 3 May 2024, for failing to comply with director identification requirements. The maximum penalty for failure to comply is currently a fine of $18,780. The Magistrate stated the director ID service had been enacted for a proper public purpose and considerable efforts had been made by government agencies to bring the accused’s attention to the service and comply. All directors are required to verify their identity with the Australian Business Registry Services (ABRS) and apply for their director ID prior to being appointed as a director. Please note that directors must apply for their director ID themselves. The fastest way is to apply online at ABRS.gov.au. If a director is unable to apply online, you can phone ABRS on 13 62 50. For more information about who needs a director ID and how to apply, visit ABRS.gov.au. If you have any questions, please contact your accountant/tax professionals, or contact us today on 02-8046 7621, your local Sydney business accountants.