A focus on topical tax issues - August 2015
Landing on the “free parking” space
On 22 July 2015, the Commissioner of Inland Revenue released a new draft public ruling Fringe Benefit Tax – Exclusion for carparks provided on an employers’ premises to clarify the fringe benefit tax (FBT) treatment of car parking facilities provided to employees on the employer’s premises.
The draft ruling seeks to clarify situations where the “on premises” exemption within the FBT rules might still apply to certain circumstances where the parking facilities are provided under a licence agreement rather than a lease agreement, provided the licence agreement allows the employer “substantially exclusive” use.
This is a positive development from the Commissioner to bring more clarity and certainty to this position, and a refreshing change when you consider that, not that long ago, moves were afoot to dramatically increase the exposure to FBT on employer provided car parking.