What is fringe benefit tax ?

Question

What is fringe benefit tax ?

Answer 1

Generally it is a tax on benefits in kind such as a company car, phone, interest free loan etc.  The tax office calculates the probably saving to you on personal expenses by having these things provided free by your employer and they tax that amount of personal expense saved.

Answer 2

Fringe Benefits Tax (FBT) is the tax applied to most, although not all, fringe benefits. A new tax was imposed on employers by India's Finance Act 2005 introduced for the financial year commencing April 1, 2005.

The following items are covered:

1) Employer's expences on entertainment, travel, employee welfare and accommodation. The definition of fringe benefits that have become taxable has been significantly extended. The law provides the exact list of taxable items.

2) Employer's provision of employee transportation to work or a cash allowances for this purpose.

3) Employer's contributions to an approved retirement plan (called a superannuation fund)..

Answer 3

Employee compensation other than your wages, tips, and salaries, such as health insurance, life insurance, and pension plans. Most fringe benefits are deductible by your employer and you do not include them in your income. In some cases, your tax-free fringe benefit amount may be limited. For instance, the cost of $50,000 of life insurance is a tax-free fringe benefit. However, if your employer pays for more than $50,000 of life insurance for you, your employer must include the cost of providing the excess life insurance with your income on your Form W-2.

Answer 4

TAX ON BENEFITS YOU ENJOY AS AS AN EMPLOYEE, INSURANCE, FREE LUNCH, ETC,