Normally, benefits you provide to your employees such as non-work-related hotel stays or loaning them a car for their private use would be considered fringe benefits, and subject to fringe benefits tax (FBT).
However, in emergency situations like natural disasters, providing immediate relief to employees who are impacted (or potentially impacted) is exempt from FBT where the assistance is for:
- first aid or emergency health care
- emergency meals, food supplies, clothing, accommodation, transport or use of household goods
- temporary repairs
- any similar matter.
These exemptions also apply where your employee has been affected by:
- an accident
- serious illness
- armed conflicts
- civil disturbances.
There are specific requirements when it comes to providing health care, and exemptions don’t apply to long-term benefits like providing a new house or car to replace one destroyed as a result of an emergency.
If you or your business are affected by a disaster the ATO understand tax is the last thing on your mind right now. The ATO have a hotline you can call for assistance in getting your tax back on track once the emergency has passed (1800 806 218). We can also help assist you during these difficult times.
If you have any questions about the information above please contact the team at Abbotts, we will be happy to assist you. You can find details to get in touch with us on our contact us page.
