Staff Celebrations & FBT

Despite the holiday season now passed, it is a timely reminder that staff celebrations all year round can give rise to Fringe Benefits Tax implications.

Many employers, provide meal and other entertainment to celebrate business and personal staff milestones and to thank their teams for their work.

However, before booking a venue or organizing an event, it’s important to consider whether the benefits provided to employees could be classified as entertainment and subject to Fringe Benefits Tax (FBT).

The FBT implications will depend on several factors, including:

✅ The amount spent per employee

✅ The timing and location of the event

✅ The attendees—are partners, clients, or suppliers included?

✅ The type and value of any gifts provided

If an employer does offer entertainment-related fringe benefits, keeping detailed records is essential to accurately determine any FBT obligations. This will help with determining whether any minor fringe benefit or other exemptions apply.

The ATO advises businesses to understand FBT rules in advance to avoid unexpected tax liabilities. Proper planning can help ensure there are no nasty FBT surprises.