Fringe Benefits Tax Law

Fringe Benefits Tax (FBT) is a tax employers pay on certain non-cash perks provided to employees, such as company cars, health insurance, or gym memberships. While these benefits enhance employee compensation, FBT ensures that employers contribute a fair share of tax on these additional perks. Although FBT is separate from payroll tax, both are important for compliance and financial planning. Employers must accurately report and pay FBT to avoid penalties, just as they do for regular payroll taxes on employee wages. Understanding FBT helps businesses manage their total employee compensation costs effectively.