What is a fringe benefit?
A fringe benefit is a benefit that a current, former, or future employer pays to you or an associate, such as your spouse or children.
A fringe benefit can be any right, privilege, service, or facility you receive, including
- the use of something, such as a car, house or equipment
- ownership of something, such as items of clothing
- enjoyment of a privilege or facility, such as staying at a holiday home
- a cheap loan
- free private health insurance
- home cleaning services, etc.
If the value of the fringe benefits you receive is greater than $2,000 in a given FBT (fringe benefit tax) year - which runs from 1 April to 31 March - your employer will have to record the grossed-up taxable value on your payment summary for the corresponding income tax year. Though these reportable fringe benefits are not included in your assessable income, they are included in the tests for various offsets and other tax benefits.