Australia may limit employment-related tax benefits

SUNNYVALE, Calif. - Oct. 17, 2013 - PRLog -- The Australian government has made strides towards imposing restrictions on certain employment-related tax benefits. This may include reforms in fringe benefits tax (FBT) and superannuation provisions, reports Nair & Co.’s International Tax Team.

The following provisions indicate, in all likelihood, changes to limit certain tax benefits:

*  New proposals repealing:

         *  The “statutory method” for calculating the FBT on motor vehicles.

         *  FBT concessions for salary packaging of certain internal fringe benefits.

         *  The age-based limit over which superannuation contributions were not mandatory, previously.

*  New measures:

         *  which seek to curtail perceived “overuse” of the “living away from home allowance” exemptions and allowances.

         *  further reporting requirements on pay slips.

*  Adjustments of the caps outlining concessional contributions and changes to the right to withdraw excess concessional contributions (including payment of tax on such withdrawals under the individual’s marginal rate instead of the current 46.5% rate).

Australian companies may consider closely monitoring the above developments. Companies might have to update their internal payroll and accounting systems to accommodate the above measures, in order to reduce any potential risks.

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