Non-cash business benefits for small business

Non-cash business benefits are widely defined as benefits received as property or services. Services include any right, privilege or benefit, and may be provided with partly or wholly, or directly or indirectly in a business relationship.

Even free accommodation at a client’s location over a long period can be deemed a benefit. It is, therefore, always best to act at arm’s length.

If the annual total received is less than $300, then such payments are exempt from tax. However, should the annual benefit exceed $300, then the total amount will be assessable.

Voluntary payments or gifts received, resulting from services provided, are also assessable income. These include holidays for best employee, for example, or even an expensive bottle of wine.

Call into your local TaxAssist Accountants’ branch to see an accountant for more specific details.

Date published 26 Sep 2016

This article is intended to inform rather than advise and is based on legislation and practice at the time. Taxpayer’s circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this article, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.