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Fringe Benefits Tax

Some elements of employee travel may have a personal component that is either incidental to the business travel, or not incidental to the business travel. Where travel is considered to be not incidental the University will incur additional taxation in the form of Fringe Benefits Tax. Briefly described, FBT is the provision of non cash benefits to employees and is administered by the Australian Taxation Office (ATO) under FBTAA (1986).

The University applied for a private ruling from the ATO received in June 2012, to clarify its position with regarding to fringe benefits tax (FBT) and our University travel policy. A copy of this ruling may be obtained from the Division of Finance.

As a guide, if the private travel component represents more than 50% of the total travel time, or if the business component of the travel is only partly funded, or if all of the travel is undertaken while on leave, then an FBT liability may apply.

In the event that a benefit is assessed as being received by the employee, the employee will be required to reimburse the University, the assessed private element of costs.

Below is a decision flowchart which will help you assess incidental versus non incidental personal travel components.

The decision flowchart is also available as a PDF

Decision Flowchart