Landmark Federal Court case opens FBT refund opportunity!

Lanmark court case opens FBT refund opportunity!

Virgin Australia is set to halve its future car parking FBT liabilities and will soon receive almost $900,000 in overpaid FBT relating to the FBT years ended 31 March 2017, 2018, 2019 and 2020 thanks to the recent Federal Court judgement.

The landmark Federal Court case agreed that the primary place of employment of flight and cabin crew members was not the home base airport terminal (where their car was parked), therefore fringe benefits did not arise as car parking was not provided in the vicinity of their workplace (one of the key requirements needed for a car parking benefit to arise).

This favourable Federal Court judgement has wide ranging implications, not only on the airlines, but other industries that employ staff on similar basis.

The basis of this favourable decision was that flight and cabin crew spent a majority of their time performing duties outside the airport terminal and therefore the terminal itself was not regarded their workplace.

Employers need to lodge an objection by 28 May 2021 (or within 4 years of the initial lodgement of the 2017 FBT return) to ensure they are still eligible to their 2017 refund entitlement, which in Virgin’s case was worth $225,000.

How to object to car parking fringe benefit assessments

Employers have 4 years from date of lodgement of an FBT return to submit an objection and refund request. Given FBT returns are ordinarily due 28 May (or 25 June with tax agents lodgement extension) its important to act quickly to ensure you remain eligible to your 2017 refund entilement:

  • Contact your Specialist Taxes Group Advisor or our friendly team on 1300 878 876;
  • Find the date of lodgement of your 2017 FBT return so that we can determine how swiftly we need to act to ensure you do not miss this entitlement;
  • Organise an initial conference call so that we can immobilise and instruct your HR team on the information needed to be able to proceed;
  • Collate your lodged FBT returns and supporting workpapers from 2017 to 2020;

Specific requirements need to be met and documented to determine whether this FBT position may apply to certain staff within your organisation.

Therefore, we strongly recommend you receive advice from Specialist Taxes Group or another suitably qualified Specialist FBT Advisor prior to considering or implementing this FBT position.

Our Specialist FBT Partner team are ready to discuss your particular situation.

Anton Mihoc +61 466 746 601
Ralph Hendrich +61 412 824 798
Paul Mather +61 403 050 358

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