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November - last edited November
I am doing the accounts for a private company, where one of the directors has a car purchased through the business for personal use, so FBT will apply. I am wondering what the steps are to set up the accounts correctly so that the FBT is recorded correctly for end of FBT year and end of Financial Year reporting and payroll summaries.
Can anyone advise what accounts (expense, asset etc) should be created? The car has already been purchased and allocated as an asset in the business accounts, with a liability account set up for the loan.
I just really need to know how to record expenses (loan repayments, fuel, servicing etc) that are related to the car in terms of FBT reporting. I also need to know if it needs to be recorded on each payslip, as a wage category, or just for end of year.
Thanks in advance
FBT can be quite complex and as such, we cannot advise directly on how to set this up in the manner best suited for your business. However I can assist with part of your query, in terms of FBT reporting during EOFY. Any Reportable Fringe Benefit Taxes can be reported through the EOFY Finalisation process in STP, in the AccountRight Payroll Reporting Centre. You'll have an option to fill in this screen as you finalise employees, at which time you can input the correct amounts of RFBT from the financial year.
Note: if you are using software below AccountRight 2020.2 and are not registered for STP, you would be looking at preparing Payment Summaries with RFBT details.
As to the more nuanced questions about recording the expenses related to the car for FBT reporting, I would recommend consulting an accounting advisor or MYOB Partner to assist you with that. If you do receive specific advice on which accounts to use, we can definitely assist in explaining how to set those up from a software point of view.