Fringe benefits tax

What’s a fringe benefit? Any items you provide to your employees that are not part of their normal salary are considered fringe benefits. This includes things like: allowing an employee to use a work car for private purposes paying for employee’s private health insurance providing entertainment through food, drink or recreation, or giving employees cheap loans More comprehensive examples for fringe benefits can be found on theATO website. The FBT year runs from 1 April to 31 March. Fringe benefits tax rates The FBT rate changes for the year ending 31 March 2015 onwards. FBT Year:  Ending Mar 2014 (and prior years) Rate: 46.5% FBT Year: Ending 31 Mar 2015 FBT Rate: 47% FBT Year: Ending 31 Mar 2016 & 31 Mar 2017 FBT Rate: 49% FBT Year: Ending 31 Mar 2018 onwards FBT Rate: 47% A full list of the FBT rates and thresholds can be found on the ATO website, including details on: Car fringe benefits statutory formula rates Deemed Depreciation Rates – Cars...

What is a Bitcoin?

Bitcoin noun: bitcoin; plural noun: bitcoins; a type of digital currency in which encryption techniques are used to regulate the generation of units of currency and verify the transfer of funds, operating independently of a central bank. “bitcoin has become a hot commodity among speculators” a unit of bitcoin. “bitcoins can be used for online transactions between individuals” – Oxford Dictionary reference Bitcoin is a form of digital currency, created and held electronically. No one controls it. Bitcoins aren’t printed, like dollars or euros – they’re produced by lots of people running computers all around the world, using software that solves mathematical problems. But bitcoin isn’t based on gold; it’s based on mathematics. It’s the first example of a growing category of money known as “cryptocurrency”. Bitcoins can be used to buy things electronically. In that sense, it’s like conventional dollars, euros, or yen, which are also traded digitally. BUT, bitcoin’s most important characteristic, and the thing that makes it different to conventional money, is that it is decentralized. No single institution controls the bitcoin network. This puts some people at ease, because it means that a large bank can’t control their money. Can I Use Bitcoin to secure finance? Essentially NO! There are many rules and the legality of your bitcoin activities will depend on who you are, where you live, and they are popular in many circles and have even incorporated an EFTPOS card, but Finance Companies in Australia will only deal with cold hard cash! The ATO do not have an answer on how to tax them. And you will probably not be able to borrow funds to buy Bitcoins, but of course his is only a ageneral rule, and we recommend you talk to your Financial Adviser if you are interested in this at all. The information out there is very plentiful, and if you are interested in learning about the Pro’s and Con’s, here are some useful links for you to read for your interest: http://www.dailyreckoning.com.au/bitcoin-the-whole-story/2014/02/15/ http://www.smh.com.au/business/banking-and-finance/australians-turn-to-bitcoins-to-boost-retirement-savings-20140805-100hcx.html http://www.coindesk.com/information/is-bitcoin-legal/...

What are the benefits of leasing over buying or a loan ?

There are both advantages and disadvantages associated with the different financing methods, so to help you decide what is best for YOU I have summarised the basic differences between leases and loans if considering a new vehicle. 1. Leases A lease is a long term agreement to finance the use of a vehicle for a fixed period of time. At the end of the term you will not own the vehicle. Generally, there are 2 main types of leases: 1- A financial lease – a residual value for a vehicle is set upfront to reflect the vehicle’s value at the end of the agreement. At the end of the term you have no option or right to purchase the vehicle, however Benson Leasing can help negotiate an offer for the set residual value. Under a financial lease you will be responsible for maintaining the vehicle. 2- A novated lease – A business may lease a motor vehicle on behalf of an employee, with the responsibility for the lease lying with the employee.  Some employers allow their employees to salary package to a novated lease, with payments will be made from your pre-tax income, and thus reducing your taxable income.  Please note that Vehicles salary packaged through a novated lease attract Fringe Benefit Tax (FBT).  Then, there are 3 main types of novated leases: Novated finance lease: where just the vehicle is leased Fully maintained novated lease: where the vehicle and its running costs are included in the lease Fully maintained novated operating lease: the vehicle and its running costs are included in the lease and the residual value risk is assumed by the lessor. Advantages of Leasing: Preserve your cashflow. You are able to acquire a new car without making the initial cash outlay. Compared to a loan arrangement to purchase the same car, a lease usually requires no down payment. Lower payments. As you are paying for a portion of the cars full value leasing payments are usually lower than loan repayments. Reduce tax. When using a salary packaged novated lease the payments are made using your pre tax income reducing your taxable income which in turn reduces the tax you pay. Increase flexibility. A lease allows you to update the motor vehicle you are leasing every few years. Maintenance. Depending on the type of the lease the maintenance and running costs of the car are included in the lease. Disadvantages of Leasing: Lack of ownership. With a lease you do not actually own the asset, this will prevent you from making any modifications to the vehicle throughout the duration of the lease. At the end of the lease you will have to return the vehicle to the lessor or be required to pay the residual still owing. Fringe Benefit Tax. The amount of FBT you’ll get charged for your car will depend on the distance travelled each year and its based value (the purchase price excluding the cost of stamp duty, registration and CPT insurance). Residual value. This value is set by lessor when the lease is established. If at the end of the lease the car is worth less than the predetermined value you will still have to pay the agreed residual value. You will have to pay GST on the residual value if you decide to purchase the car when the lease ends. Long term legal obligation. A lease is a legal document that carries long term obligations. It can be difficult to cancel a lease agreement and there will penalty fees and costs associated with the cancellation. 2. LOANS A loan is used to...

Finance and Leasing Solutions are our passion

Benson Leasing can help your business get the equipment it needs, without putting a strain on your cash flow. Whether it’s printing machinery, butchery equipment, catering equipment, gaming machines or medical equipment – as specialists in business equipment finance, Benson Leasing will have a solution for you. Benson Leasing is a team of finance brokers and funders in its own right with the knowledge, experience and education to negotiate the best rates, and the right funding  to get the approvals you need without fuss or complication. You need to be confident that the finance approval process will be trouble free so you can get on with running your business. Benson Leasing are experts in finance and leasing. We have direct and fast access to the major and specialised finance products in today’s competitive market. Benson Leasing has a variety of solutions and answers to your finance questions, no matter how obscure your requirement is. We can arrange finance for cars, trucks, equipment, heavy machinery, catering equipment or small ticket items. Whether it be new or second-hand equipment, we have a product that will fit. Benson Leasing can help you get the best deal, from the widest range of finance products. Call us today on 1300 795 058 to discuss your finance...

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