The ATO has released specific guidance on fringe benefits and the impact of COVID-19, particularly in relation to car fringe benefits. For these benefits, the ATO confirms that the treatment will often depend on whether the taxable value is calculated using the operating cost method or the statutory formula method.
For example, under the statutory formula method, if a car is garaged at or near the home of an employee, then it is generally treated as being available for private use of the employee and can trigger a car fringe benefit, even if the car isn’t actually being used by the employee.
If the statutory formula method is used then the “normal” calculation process needs to be followed. When a car is garaged at or near the employee’s home then this would be taken into account in determining the number of days that the car fringe benefit has been provided.
However, the ATO accepts that if the car is not driven at all or is only driven briefly for maintenance purposes, then it will not be taken to be a fringe benefit for the purpose of the operating cost method. This means that there should be no FBT liability for the period that the car is garaged at the employee’s home and is not being driven under this method. The employer should ensure that they have odometer records to show that the car hasn’t been used or has only been driven briefly to maintain the car.
Other areas of guidance include:
- Employers providing property for employees to work from home (e.g., laptops and other devices), including the operation of the minor benefits exemption;
- Emergency transport;
- Provision of personal protective equipment (i.e. masks etc) to employees and when this may be an exempt benefit; and
- Expenses incurred in COVID-19 testing for employees.
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