Will the tax man take his tablet?
iPad fever is gripping the globe, and SmartSalary customers are certainly not immune! We’re getting more and more queries about whether our customers are allowed to salary package these machines so I thought now would be a good time to offer a quick reminder of how the salary packaging rules work when it comes to devices such as tablet computers.
Since I’m not the expert in this field I have, once again, asked our Senior Tax Advisor to pull together a quick summary of the rules . . . . take it away Simon!
Thanks Deven – the first thing to note is that it doesn’t really matter whether tablet computers are considered laptops, PDAs or even mobile phones as the salary packaging concession no longer revolves around the definition of these items. Any “portable electronic device” can now potentially access the concession as long as two requirements are met:
1. The device must have been acquired for the primary purpose of use in your actual employment duties, and
2. You must not have salary packaged any similar items earlier in the relevant FBT year.
Employers who see ipads as potential work tools for their employees are starting to instruct SmartSalary to include them in their salary packaging menu, and we’ll be sending comms to those employees as this benefit comes on line. We’ve asked the ATO to clarify what devices it considers to be ‘similar’ to tablet computers for the purposes of requirement 2, but for now, while we wait to hear from the ATO, SmartSalary is taking a conservative view and packaging tablet computers as though they are laptops (i.e. we won’t allow both in the one FBT year).
So keep your eyes and ears peeled for further updates from us or your employer!
I think you’ll find the following clarifies the ato position
http://www.ato.gov.au/taxprofessionals/content.aspx?doc=/content/00255048.htm&page=17&H17.
In particular “it was accepted by the ATO that the iPad would not have substantially identical functions to a laptop computer.”
Well spotted Daniel – and you’ll be pleased to know that was our question to the NTLG (that’s what I was referring to above when I said “we’ve asked the ATO to clarify what devices it considers to be ‘similar’ to tablet computers”)!
However, despite the ruling clarifying that the ‘one per FBT year’ rule does not limit the packaging of both an iPad and a laptop, I note that many of our employer clients have nonetheless decided to restrict employees to one only because of the other restriction applicable to this benefit. That is, the requirement that the machine be used primarily as an employment tool.
It is difficult for many employers to justify a conculusion that an employee needs both a laptop and an iPad in order to perform their ordinary employment duties. You should contact our Service Centre or check our website if you’re not sure what your employer’s position in relation to this issue is.