In the 2015–16 Budget, the Government announced that it will allow a fringe benefits tax (FBT) exemption from 1 April 2016 for small businesses with an aggregated annual turnover of less than $2 million that provide employees with more than one qualifying work-related portable electronic device, even where the items have substantially similar functions.
The ATO defines a portable electronic device if it satisfies all the following criteria:
• Easily portable and designed for use away from an office environment;
• Small and light;
• can operate without an external power supply; and
• designed as a complete unit.
Listed examples of portable electronic devices include a mobile phone, calculator, personal digital assistant, laptop, portable printer and global positioning systems (GPS) navigation receivers.
Even though the government has lifted the rule on limiting small business entities to provide one eligible work related portable device per employee, there are limitations on the exemption. These are:
• items primarily for use in your employee’s employment – that is, for work-related use; and
• one item per FBT year for items that have a substantially identical function, unless the item is a replacement item.
This article appeared in our July 2016 newsletter