Insight

Fringe Benefits Tax implications of flexible work

By:
Leanne Tomkinson
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Since the beginning of the COVID-19 pandemic, over a third of the Australian workforce has been predominantly working from home. With little time to plan before the first lockdown, this dramatic shift changed the nature of workplaces and caused organisations to review their business models – potentially forever.

Two years later, businesses and employees have embraced the positive impact of working from home and the value in being agile in response to potential restrictions or virus variants. But as organisations discuss ongoing flexible work arrangements, and the support and equipment to allow employees to work from home, what Fringe Benefits Tax (FBT) implications, concessions and exemptions should be considered?

Since 2020, businesses were able to take advantage of Federal and State financial support, including FBT concessions and exemptions available for certain benefits provided to employees under their new working from home arrangements. These span across equipment to work from home, health benefits, car parking, as well as considerations such as the FBT implications of the provision of Rapid Antigen Tests for work purposes.

In addition, the way in which these benefits are provided and the structure of arrangements can make a significant difference to tax outcomes, accessibility of concessions and reductions. Especially for large organisations, ensuring the provision of benefits is structured strategically when seeking to support employees can lead to substantial savings or the avoidance of large unexpected FBT costs

To ensure businesses leverage tax efficiencies available, now is the time to consider this year’s FBT implications and future benefits for employees continuing to work from home. As these arrangements can be highly complex, please don’t hesitate to reach out to our team to discuss reviewing the tax-effectiveness of your current arrangements, as well as tips and traps to look out for.

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