FBT Year End: What it Means for Your Salary Packaging

It’s not often you get told to spend, spend, spend. But this is one of those times. You’ve probably been responsible with your finances for most of the year, but when it comes to salary packaging – the fringe benefits tax year end (FBTYE) is here, and that means a few very important things if you’re planning on getting all the benefits out of salary packaging in the coming year. In this blog, we’ll cover exactly how the end of the FBT year affects salary packaging and all the best ways to get the most out of this side of the financial year.

When is the end of the Fringe Benefits Tax (FBT) year?

The FBT year runs from the 1st of April to the 31st of March every year. The tax office made this decision to try to reduce the pressure of having to do fringe benefit reporting on top of the usual tax return, which is required at the end of the traditional financial year.

What does the end of the FBT year mean for me?

As we salary package expenses, we use more and more of the allocated yearly amount available to each of us. As we do so, our ‘salary packaging account balance’ gets used up. The reason the end of the Fringe Benefits Tax season is important is because when the FBT year restarts, your allowance restarts, too.

Let’s break it down –

Any unused salary packaging funds you might still have in your salary packaging ’account’ on the 31st of March 2024, will be taken off your salary packaging cap allowance in the new FBT year. By not spending that amount, it’s assumed that you either don’t need it or can’t spend it. The actual funds are transferred over (you don’t lose the money!), and the value is then deducted from your new cap allowance – which is the amount you can salary package in the coming year.

Here’s an example to make sure you don’t miss out –

If your salary packaging cap is $15,900 – and you currently have a balance of $200 on your salary packaging card on the 31st of March, you’ll only have $15,700 in the coming fringe benefits tax year for 2024.

This means that your goal until the tax year ends is to make sure you’ve spent everything in your ‘salary packaging account’.

So where can I spend the balance?

Luckily, there are a ton of things you can spend the balance on. To simplify it, we’ve compiled a list of the most popular ways to do that. You can spend it on: 

  • Everyday expenses or a big purchase you’ve been planning.
  • Vouchers/gift cards
  • Holiday accommodation
  • A gym membership
  • Eating out at a restaurant (using your meal and entertainment card) 

(Remember you can pay for your friends or family members too.)

  • Repairs or a service to your car 

Speak to CBB The Salary Packaging People, for more information about where you can spend your balance.

When should I spend it?

We now know that the end of the FBT is the 31st of March, but it’s important to remember the fact that even though the initial transaction happens instantly when you buy something, it can take a few days for your salary packaging balance to adjust. Each salary packaging provider has a different cut-off date for final expense claims, so check with yours to be 100% sure. The best advice is not to leave your spending till the very last minute.

Smart salary packaging spending

Now, you’re ready to get the most out of your salary packaging amount this year. We know some of it can get a bit tricky, especially when it comes to understanding Fringe Benefits Tax, so if you have any questions or need guidance with anything salary packaging-related, get in touch with a member of our team today. We’re ready to help everyone in the not-for-profit sector get the most out of your salary.