TAX ASSIGNMENT

Tax Assignment

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Name of Institution

Tax Assignment

Question 1

A fringe benefit is any benefit one offer to an employee or to the affiliate of an employee (such as their partner or children) moreover to their wage or income. Some of these products could consist of (Rediff Business, 2005):

• Allowing an employee to use a work car for private purposes

• Providing employees with cheap loans

• Releasing an employee from an owed debt

• Reimbursing an expense incurred, such as school fees

• Providing accommodation

• Providing living-away-from-home allowances.

• Providing entertainment by the way of food, drink or recreation

• Providing salary package arrangement, or

• Providing goods at a lower price than they are normally sold to the public.

As an employer, if one have offered any of the above products to their workers in regards to their career, as well as others, then one could be responsible for Fringe Benefits Tax.

The Fringe Benefits Tax (FBT) year stops on 31 March each year and transaction of any necessary FBT is due by 21 May. Qualified benefits that are compensated must be registered on employees' transaction summaries for the earnings year conclusion 30 May of the same year (Money Buddy, n.d.).

As an employer, it is their liability to figure out whether one have offered fringe benefits to their workers during the course of the FBT year, and consequently, whether one are responsible to pay FBT on those benefits. If an employee is getting certain fringe benefits of higher complete taxed value than $2,000 in an FBT year, one must review the complete taxed value to the Australia Tax Office (The Quinn Group, 2011).

If one have offered any of the above products to their workers since 1 Apr 2010 one may be responsible for the transaction of FBT, so it is necessary to consider this before the end of the FBT year. It is also worth noting that the price one have in offering fringe benefits to their workers is usually a permitted earnings tax reduction, though this should always be mentioned with their economical advisor or economical advisor (Money Buddy, n.d.).

Accident or wellness plans are arrangements that provide benefits for workers, their partners, and household in the event of injuries or illness. Employer efforts may be created toward the price of incident or insurance, or to a separate trust or finance that provides incident and insurance benefits either immediately or through protection Plan Company (Rediff Business, 2005).

Generally the value of protection offered by their company is not included in their taxed earnings for government earnings tax requirements or public protection and Medical wellness insurance requirements. This exemption relates to expenses created immediately to workers or receivers, and expenses created in a roundabout way, to deal with, and contain payments of medical costs, and expenses for specific diseases or injuries (The Quinn Group, 2011).

The exemption of these benefits from taxed earnings relates to current workers, full-time agents (statutory employees), on workers, former workers for whom protection is managed based on the employment relationship, widows and widowers of former workers, and ...