QUESTION 2 AGGREGATE FRINGE BENEFITS, FBT LIABILITY PAYABLE

During the fringe benefits tax (FBT) year ended 31 March 2020, Jolly Finance Limited

(JFL) provided the following employee benefits.

1.

JFL held a corporate box at the MCG and its employees used the corporate box

to entertain its clients at cricket, football and other events. Catering costs for

food and drinks was $28,000, which was charged based on each persons

attendance at the event. The arrangement also involved a lease of $137,000.

Included in this cost, was $61,000 that always provided the right to advertise

its company logo on the corporate box, and during games and other events on

the electronic perimeter ring. The company elected to use the 50/50 method.

2.

JFL reimbursed all of its 10 managers with the Qantas Club membership costing

each member $970.

3.

JFL enabled a manager to salary sacrifice superannuation $10,000

4.

JFL paid Health insurance for all its staff. Total cost was $25,000.

5.

JFL paid an interviewees airfares to attend an interview at its office and paid

the airfare, overnight accommodation and taxi fees.

REQUIRED

Part 1

Calculate the aggregate fringe benefits under s 5C FBTAA 1986 (12 marks)

Part 2

Calculate the FBT payable under s 5 and s 66, FBTAA 1986 (3 marks)

Hint: Use the following template for your answer

Benefit and the Law	Taxable value	Basis of calculation of taxable value (include law)

(12 + 3 = 15 Marks)

In your responses, ensure you state the appropriate taxation legislation, to support your

answer and your calculations.