TBO’s Process for Preparing FBT Returns

At The Breakthrough Office, we manage FBT compliance through a shared responsibility between the Payroll and Technical teams. Throughout the year, monthly reconciliations ensure salary sacrifice deductions are accurately recorded and capped appropriately. The Payroll team maintains detailed tracking of each employee’s deductions, while the Technical team performs an end-of-year review using the FBT Deductions by Employee template.

This process includes exporting a transaction listing, reconciling deductions, flagging discrepancies (especially for in-house arrangements like meal entertainment), and ensuring all substantiation is on file. The goal is to ensure a smooth return preparation by mid-May and avoid any excess deductions or late lodgement penalties.

Learning Objectives

By the end of this section, you should be able to:

• Understand the shared responsibilities of the Payroll and Technical teams in managing FBT.

• Follow the monthly reconciliation process to track deductions and ensure compliance.

• Use the FBT Deductions by Employee template to conduct end-of-year reconciliations.

• Identify red flags, such as excess deductions or missing substantiation, that require follow-up.

• Prepare clients for timely and accurate FBT return lodgement by the May deadline.