The Guides to Social Policy Law is a collection of publications designed to assist decision makers administering social policy law. The information contained in this publication is intended only as a guide to relevant legislation/policy. The information is accurate as at the date listed at the bottom of the page, but may be subject to change. To discuss individual circumstances please contact Services Australia.

1.1.R.70 Reportable fringe benefits total

Definition

A parent's reportable fringe benefits total is a component of ATI (2.4.4.20) (1.1.A.20), and is the amount of reportable fringe benefits as defined in the Fringe Benefits Tax Assessment Act 1986 for the year of income (1.1.Y.10).

A fringe benefit is a benefit that is provided to an employee or an associate of the employee (such as a family member) as part of the employment arrangement. An employee can be a current, future or former employee. The term benefit is broad and includes any right, privilege, service or facility.

Common examples of fringe benefits provided from employment are:

  • provision of a car, house or equipment for private purposes
  • a novated lease for purchase of a motor vehicle
  • giving somebody ownership of something, for example, items of clothing
  • permitting somebody to enjoy a privilege or facility, for example, a discounted loan or discounted airfares, and
  • provision of a service, for example, use of skill or labour.

Income derived by the provision of a fringe benefit within the meaning of the Fringe Benefits Tax Assessment Act is exempt income and is not taxable income (1.1.T.20) (Income Tax Assessment Act 1936 section 23L). An employer has to pay tax on the taxable value of a fringe benefit. The taxable value of a fringe benefit is usually reduced by the amount of any payment by the recipient or employee towards the fringe benefit. There are specific valuation rules for each category of a fringe benefit (Fringe Benefits Tax Assessment Act Part III).

Employers are required to report on an employee's payment summary all fringe benefits with a total taxable value of more than $2,000 a year (Fringe Benefits Tax Assessment Act section 135P). The total taxable value means the amount that the employer paid or assigned as the value of the benefit. However, the grossed up taxable value (which is the total taxable value as determined by the employer multiplied by a figure pre-determined by the ATO) will appear on the employee's payment summary. The grossed up taxable value is known as the 'reportable fringe benefits' amount.

Act reference: CSA Act section 5(1)-‘reportable fringe benefits total’

Policy reference: CS Guide 2.6.14 Reason 8 - a parent's income, property, financial resources, or earning capacity, 2.4.4.20 Adjusted taxable income

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