These benefits are specifically exempt from Fringe Benefits Tax and provide the greatest advantage to employees by offering the largest tax savings per dollar packaged. Any employee can salary package FBT-free benefits and achieve a financial saving as long as the employee would normally pay an amount of Income Tax.

Exempt benefits are not reportable on an employee’s Payment Summary. Exempt benefits do not contribute towards the usage of an employee’s FBT Rebate Concession Cap.

These benefits satisfy the ‘Otherwise Deductible Rule’, where the employee would have been entitled to claim a work-related Income Tax deduction for the expense if it has been paid for with the employee’s post-tax funds (i.e. not salary packaged). Otherwise Deductible benefits are exempt from Fringe Benefits Tax and provide the the largest tax savings per dollar packaged.

Otherwise Deductible benefits primarily provide a timing benefit only; once they have been salary packaged they are no longer eligible to be claimed on an employee’s Income Tax return at the end of the financial year.They do not contribute towards the usage of an employee’s Rebate Concession Cap.

These fringe benefits are subject to FBT concessions; with the FBT payable on each benefit calculated using specific criteria. The concessions arise because any applicable FBT is calculated using this criteria and is not derived directly from the actual monetary value of the benefit. Concessionally taxed benefits will be advantageous for most employees dependent on their income level and the criteria specific to the FBT calculation for each particular benefit.

Concessional fringe benefits are either not reportable on an employee’s Payment Summary, or reported upon at a reduced amount based on the relevant concession. These benefits will utilise an Employee’s FBT Rebate Concession Cap at a reduced rate (due to available concessions).