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FBT reasonable food and drink amounts

Posted by Northadvisory on April 2, 2019

Taxation Determination TD 2019/7 sets out the amounts that the Commissioner considers reasonable under s 31G of the Fringe Benefits Tax Assessment Act 1986 for food and drink expenses incurred by employees receiving a living-away-from-home allowance (LAFHA) fringe benefit for the FBT year commencing on 1 April 2019.

Where the total of food and drink expenses for an employee (including eligible family members) does not exceed the amount the Commissioner considers reasonable, those expenses do not have to be substantiated under s 31G. If an employer wants to reduce the taxable value of an employee’s LAFHA fringe benefit by the exempt food component, the expenses must be either:

  • equal to or less than the amount the Commissioner considers reasonable under s 31G(1)(b), or
  • substantiated in accordance with s 31G(2).

If the total of an employee’s food or drink expenses exceeds the amount the Commissioner considers reasonable, the substantiation provisions under s 31G will apply.

Reasonable amount for food and drink — in Australia

Table 1 below sets out the weekly amounts the Commissioner considers to be reasonable food and drink amounts for a LAFHA paid to employees living-away-from-home within Australia for the FBT year commencing on 1 April 2018. These amounts are for the total of food or drink expenses and include any amounts that may have been allowed for home consumption.

Table 1: Reasonable food and drink amounts — in Australia

Per week ($)

One adult

269

Two adults

404

Three adults

539

One adult and one child

337

Two adults and one child

472

Two adults and two children

540

Two adults and three children

608

Three adults and one child

607

Three adults and two children

675

Four adults

674

Note: “Adults” for this purpose are persons who had attained the age of 12 years before the beginning of the FBT year.

In relation to larger family groupings, the Commissioner accepts the reasonable food and drink amount based on the above figures plus $135 for each additional adult and $68 for each additional child.

Reasonable food and drink amounts — overseas

Tables 2 to 4 of TD 2019/7 set out the weekly amounts the Commissioner considers to be reasonable food and drink amounts for a LAFHA paid to employees living-away-from-home outside Australia for the FBT year commencing on 1 April 2019.

Table 2 sets out the cost group to which a country has been allocated. Please refer to TD 2019/7 for Table 2.

Table 3 sets out the reasonable amount for food and drink expenses for each cost group. If the employee lives away from home in a country that is not shown in Table 2, the employee can use the amount for cost group 1 in Table 3.

Table 3: Amounts by cost group

Cost Group

Food and drink for one adult

1

$137

2

$201

3

$273

4

$328

5

$437

6

$537

Where the employee is accompanied by other family members while overseas, the reasonable food and drink amount per week for the family is worked out by multiplying the amount shown in Table 3 by the relevant factor in Table 4 below.

Table 4: Factors to apply for family groups — overseas

Family group

Factor

Two adults

1.5

Three adults

2.0

One adult and one child

1.25

Two adults and one child

1.75

Two adults and two children

2

Two adults and three children

2.25

Three adults and one child

2.25

Three adults and two children

2.5

Four adults

2.5

In relation to larger family groups, the Commissioner accepts the reasonable food and drink amounts can be increased:

  • for each additional adult, by a further 50% of the relevant single adult rate in Table 3, and
  • for each additional child, by a further 25% of the relevant single adult rate in Table 3.

If you have any questions about claiming reasonable amounts for food and drink expenses as a tax deduction, please do not hesitate to contact us.

Norman Ruan
Accountant
T: 02 9984 7774
E: normanr@northadvisory.com.au