Hot Wheels Racing Pty Ltd provided the following benefits to employees during the FBT year ended 31 March 2020: A car fringe benefit (GST included) with a taxable value of $6,500 and an expense payment fringe benefit (no GST) with a taxable value of $1,200. What is Hot Wheels Racing Pty Ltd's FBT liability for the year ended 31 March 2020?

Question

Quizplus · Accepted Answer

The FBT liability is calculated by grossing up the taxable value of the benefits and applying the FBT rate. The car fringe benefit is grossed up using the Type 1 gross-up rate (2.0802) and the expense payment fringe benefit using the Type 2 gross-up rate (1.8868). The FBT rate for the year ended 31 March 2020 is 47%. The calculation is: ($6,500 x 2.0802 + $1,200 x 1.8868) x 47% = $7,418.95.

Hot Wheels Racing Pty Ltd Provided the Following Benefits to Employees