“That ICPA (Aust) lobbies relevant ministers to support the removal of the Fringe Benefits Tax (FBT) for businesses who would like to provide financial assistance to employees residing in geographically isolated areas, to enable their children to attend boarding school.”
In many rural and remote locations there is limited or no access to suitable compulsory education facilities and therefore boarding school is the only option. This can often become unaffordable to families, especially when there is more than one child, so families are forced to relocate to employment with closer access to school facilities, resulting in further loss to the already diminished workforce of remote regions. In recognition of conditions, the Australian Tax Office already offers FBT concessions for employer provision of housing where there is a lack of sufficient residential accommodation in remote locations.
Similar concessions should also apply when employers financially assist with the schooling costs of employees’ children where there is a lack of appropriate schooling facilities available in those same remote locations. Currently when employers offer financial assistance towards the cost of schooling, the payment is deemed a Fringe Benefit and taxed at the applicable rate of 47% so any contribution made by the employer is compounded with almost half the amount again in tax.
The cost of accessing compulsory education for geographically isolated children should not be taxed, irrespective of who is bearing the cost. Affordable access to boarding schools for employees who work in remote areas provides their children with equitable access to school facilities as those in non-remote regions. It also serves to keep valuable families in remote Australia, supporting an already challenged workforce.
