Generally, the most tax effective outcome when providing Employees with gifts is to ensure that the following is adhered to:
1. The gift is less than $300, Goods and Services Tax (GST) inclusive.
2. The gift is provided infrequently or not on a regular basis.
3. The gift is not classified as entertainment.
4. The gift is not provided as a reward for the employee services.
If the above is achieved, then generally a tax deduction will be available to the business / employer with no Fringe Benefits Tax (FBT) payable.
Non-Entertainment Gifts include:
- Christmas Hamper
- Bottle of alcohol
- Gift vouchers
- Flowers
- Food Items, i.e., chocolates
Entertainment Gifts include:
- Tickets to sporting events
- Tickets to the movies / musicals
- Flight and accommodation for holidays
- Memberships to a club
Please note that Gifts categorised as entertainment will not meet the requirements of a tax deduction.
If you would like to discuss further please contact us:
McNamara & Company - Chartered Accountants, located minutes from the Melbourne CBD
www.mcnamaraandcompany.com.au/contact-us
Phone +61 3 9428 1062
Email admin@mcnamaraandco.com
