Dec 21 2015
Does your employee have a HELP/HECS debt?
Did you know that Reportable Fringe Benefits have the potential to impact on your employees’ HELP/HECS minimum repayments?
Meals & Entertainment Benefits will now be reportable on your employees’ 2016-2017 payment summary as outlined in our previous article’s FAQ and hence will be included in their Reportable Fringe Benefits amount. This may therefore impact your employees’ HELP/HECS minimum repayments.
The Australian Taxation Office (ATO) considers the following as HELP/HECS repayment income:
– Their taxable income for an income year; PLUS
– Any amount their taxable income has been reduced by a net rental loss; PLUS
– Their total reportable fringe benefits amounts shown on your Payment Summary.
To ensure that your employees are prepared for the upcoming changes, they will need to advise your payroll department to calculate their HELP/HECS on their total estimated income, including their Reportable Fringe Benefits amount (which now includes Meals & Entertainment benefits). To do so, they should complete an ATO form called Withholding Declaration Upwards Variation and supply it to your payroll department accordingly. They can obtain this form from the ATO website.
For further information specifically associated with their personal HELP/HECS minimum repayments and their Reportable Fringe Benefits amount, we recommend that they seek independent financial advice from their financial adviser or their accountant.