May 30, 2022 Matthew Hung

Fringe Benefits and religious practitioners – new ATO examples

The ATO has recently added some new examples on its website to help explain the requirements for exempt fringe benefits provided to religious practitioners.   These examples are in addition to the examples provided in Taxation Ruling 2019/3.

The examples are specific and are unlikely to be an exact match to the scenarios in your religious institution.  Organisations will need to consider their particular arrangements with their religious practitioners and exercise judgement.

For instance, one of the examples concludes that the duties of a minister of religion and musical director for a religious institution’s weekly service, are not directly related religious activities and so any fringe benefits provided to that person would not be Fringe Benefits Tax exempt.   The person’s listed duties include scheduling performers, conducting rehearsals, attending production meetings and managing the technical rehearsal.  If your organisation employs such a person but their duties also include things like screening songs for appropriate doctrinal content and providing pastoral care for the musical team, it is more likely that any fringe benefits paid to them would be exempt from Fringe Benefits Tax.

If you need help in this area contact your RDL advisor.  The ATO examples can be found here.