It is important for business owners to know what to report to the ATO so they can avoid making costly mistakes. Here are some fringe tax benefit related items that often attract the ATO’s attention.
The ATO is flagged when there is failure to report motor vehicle fringe benefits, incorrect application of exemptions for vehicles and incorrect claim for reductions for these benefits. It also catches their attention when there is a mismatch between the income amounts on an employer’s tax return and the amount reported as an employee contribution on an FBT return.
Make sure you correctly report an entertainment expenses deduction as a fringe benefit or correctly classify entertainment expenses as advertising or sponsorship to avoid catching the ATO’s attention. You should also correctly calculate car parking fringe benefits and support them with adequate evidence especially if there are significant discounting market valuations or you use non-commercial parking rates.
Don’t forget to report fringe benefits on business assets that are provided for the employees and associates’ personal enjoyment; be on track with your obligations and lodge FBT returns on time to stay off the ATO’s radar. The ATO examines returns that are not lodged with a high amount of incoming and outgoing amounts of cash as well as the timing of when previous returns have been lodged. BAS returns also come under their scrutiny.
As you look for different ways to grow and improve your business, seeking professional advice from a business accountant and consultant could prove to be an important and helpful decision.
You can click here to speak to business experts. We would love to help you formulate investment strategies and streamline your processes to take your business to the next level. Our goal is to help you grow your business, find ways to invest more and increase your productivity.
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