Where businesses provide car parking fringe benefits to their employees, the taxable value of these benefits must be calculated correctly to ensure they are meeting their fringe benefits tax (‘FBT’) obligations, regardless of the method used.
The ATO has advised they may directly contact businesses who have engaged an arm’s length valuer, as required under the ‘market value method’.
According to the ATO, in some instances, valuers have prepared reports using a daily rate that doesn’t reflect the market value, meaning the taxable value of the benefits is significantly discounted or even reduced to nil.
The ATO wants businesses to understand that engaging an arm’s length valuer does not mean they’ve met all the requirements for working out the taxable value of their car parking fringe benefits.
It is actually the business’s responsibility to confirm the basis on which valuations are prepared, and they are expected to examine any valuation they suspect is incorrect or which considerably reduces their liability.
We can help check if a valuation report required under the market value method meets the ATO’s requirements.
In addition to the valuation report, businesses need a declaration relating to the FBT year that includes the:
- Number of car parking spaces available to be used by employees;
- Number of business days; and
- Daily value of the car parking spaces.
Have questions? Contact us on (08) 9406 8537 or info@omegaca.com.au.