Car Parking FBT Rules – Could your business be stung?
With an increase in public carparking costs and more shopping centres now charging for car parking, nearby businesses may find they’re now hit with an FBT bill.
If your business provides car parking to its employees and you’re located within 1 kilometre of a commercial car park where the minimum daily cost is above the parking FBT threshold (currently $8.66 a day for 2017/18 year), then you could be liable to pay FBT on the value of the carparks you provide. Here are the rules around carparking FBT:
- The parking you provide your employees is not in a commercial carpark, but on premises owned or leased by the business
- The car is parked for more than four hours on its premises between 7am and 7pm
- The car is owned or leased by an employee, or provided to the employee by the business
- The car is used to travel between home and work at least once that day
- The parking is provide as part of the employee’s employment
- A commercial carpark charging above the minimum daily threshold is within 1km of the business (as travelled by the shortest practicable route from a car entrance to those premises)
There are some exemptions however:
- Small business whose total gross income before deductions was less than $10 million for the previous FBT year, and is not a Government body or listed public company or its subsidiary.
- Certain not for profits including charitable and religious and educational institutions.
- Disabled car parking if the disabled employee is legally entitled to use a disabled person’s parking space and has a permit.
If you’re uncertain of your FBT obligations when it comes to carparking, please reach out to your trusted PJT advisor for further advice.