Families, Housing, Community Services and Indigenous Affairs
Retention of current fringe benefit tax treatment for family assistance customers
| 2007‑08 | 2008‑09 | 2009‑10 | 2010‑11 | 2011‑12 | |
|---|---|---|---|---|---|
| Department of Families, Housing, Community Services and Indigenous Affairs | - | 57.5 | 59.0 | 60.5 | 62.1 |
| Department of Education, Employment and Workplace Relations | - | 4.3 | 4.4 | 4.5 | 4.6 |
| Centrelink | - | 0.3 | - | - | - |
| Total | - | 62.1 | 63.4 | 65.0 | 66.7 |
The Government has decided not to proceed with a component of the measure Child Support Reforms — aligning income definitions announced in the 2006‑07 Budget. This component would have changed the way fringe benefits are assessed for the purpose of calculating adjusted taxable income to determine eligibility for personal benefit payments (such as Family Tax Benefit). It would have meant that the calculation of adjusted taxable income was based on what the employee would have to earn in after-tax income to afford the fringe benefit (the grossed-up value), rather than the value of the fringe benefit itself (the net value). The measure was scheduled to commence from 1 July 2008.
The use of the net value of the fringe benefit will be retained in the definition of adjusted taxable income for family assistance.
The Government has requested that the Australia's Future Tax System Review examine the complexity of existing fringe benefit arrangements and make recommendations to improve equity and simplicity in the longer term.
This measure will cost $257.2 million over four years, and includes Centrelink funding of $0.3 million in 2008‑09.
Further information can be found in the press release of 26 June 2008 issued by the Minister for Families, Housing, Community Services and Indigenous Affairs.
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