FBT and GST 24 June 2008 Organised by the Office of Chief Accountant. Salary Packaging at the University. Future direction is to continue to outsource provision of benefits to external service providers Examples are novated car leases and laptops
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24 June 2008
Organised by the Office of Chief Accountant
Future direction is to continue to outsource provision of benefits to external service providers
Examples are novated car leases and laptops
However University still must determine its FBT and GST compliance on expense reimbursements – mainly entertainment
Where “entertainment” can be identified -
Business Lunch is attended by 2 employees and 5 visitors. University reimburses its employee for entire cost of the meal. FBT portion is 2/7th of the expenditure on the lunch.
Staff meeting takes place at a restaurant or café outside the University – does this involve the provision of entertainment? Staff member seeks reimbursement of meal costs.
What happens if staff meeting takes place at the University and alcohol is provided?
When we say “NO GST” on non-employee entertainment we mean no entitlement to a GST input tax credit whether GST is on the invoice or not
Two staff members travel to Brisbane to meet Uni Qld staff.
If the employees dine in the evening alone or together this is not entertainment.
Two staff members travel to Brisbane to meet Uni Qld staff. While there, they meet up with a Uni Melb employee who is also travelling on business
If all three dine together this is not entertainment.
Two staff members travel to Brisbane to meet Uni Qld staff. While there they meet up with a Uni Melb employee who is also travelling on business.
In the evening all three dine with a Uni Qld employee who is not travelling. Syd Uni picks up the tab. The Qld Uni staff member’s meal is entertainment. The other meals are not entertainment.
A Uni Qld staff member travels on business to Sydney to meet with a Uni Syd employee.
The Uni Qld employee is invited to lunch. Wine is served with the meal.
Uni Syd employee pays for the meal and seeks reimbursement.
The portion of the meal costs attributable to the Uni Qld employee is not entertainment. The meal cost attributable to the Uni Syd employee is entertainment.
What happens if I invite someone for coffee or a light lunch? I invite a Uni NSW employee for coffee and muffins in a local café.
What happens if I invite someone for coffee or a light lunch while travelling? I’m travelling in Paris and I invite a French academic for brunch.
THIS IS NOT MEAL ENTERTAINMENT!
Staff farewell – if on premises and consists of a cake, maybe some drinks, this is not entertainment
But if at a restaurant or held on premises with more than moderate alcohol – then it is meal entertainment
Not subject to FBT
Subject to FBT
The key is that the work retreat must:
Business Seminars FBT exempt
Remember that it is unlikely that food and drink served at seminars will be regarded as meal entertainment!
But what about dinner provided at an outside restaurant during the conference/retreat?
This is a social function
Please explain the GST treatment of grants and appropriations received by the University
These are subject to GST:
These are NOT subject to GST:
The University receives appropriation money from DEST which is to be disbursed to Uni NSW.
The funds received from DEEWR by the University are not subject to GST.
Uni NSW will need to raise a GST tax invoice for the transfer from Uni Sydney.
Uni Sydney is entitled to a GST input tax credit.
The University receives grant money from ARC – advice from ARC that these grants are not subject to GST
NHMRC grants are not subject to GST
Remember we receive RCTI’s from NHMRC
How do we know if a course charge is GST-free?
Fee for Tertiary Education Course (“TEC”)
Admin services related to a TEC
Not Accommodation or Lease of Goods associated with a TEC
Excursions or field trips related to a TEC
but not food and accommodation
Bachelor, Master and Doctor
Adult and Community
can be offered by a University
adds to employment related skills
Professional or Trade
Tertiary Residential College
What are administrative services?
Includes in the view of the Taxation Office:
enrolment services, including the processing of late enrolments
late issue or replacements of student cards
examination arrangements and assessments of students including re-assessment of results where a student has failed
processing academic results including duplicate degree copies
overdue charges or late payment charges
administration of the library
administration of a textbook scheme
administration of the supply of course materials
charges for HECS statements
What are NOT administrative services?
Student hall application fees
Foreign student application fees
Hire of academic dress
The University of Sydney is providing On-line writing support in English for students at University of Hong Kong?
Is the supply subject to GST?
Where services are being provided to a non-resident who is not in Australia and the effective use/enjoyment is outside Australia, the supply is not subject to GST. It is treated as a export of services.
If the University is to assemble an equipment in Australia for an overseas client will the supply be subject to GST?
The supply for consideration would not attract GST because the effective use or enjoyment is not within Australia even though the goods have been assembled in Australia.
University hosts a career development day for students. An external organisation agrees to donate some funds to the Uni provided they are allowed to set up a stall for their marketing purposes.
Is it subject to GST?
Donations with material benefit by the donor is subject to GST. If the donor was not receiving a material benefit then GST would not apply. But in this instance the donor is receiving a material benefit.
Food and drink provided at a staff function is generally funded from staff contribution. However in some instances University may make some contribution.
Is the University contribution subject to FBT?
The University contribution is subject to FBT.