What is fringe benefit tax (fbt) tax?
Fringe Benefit Tax, or FBT, is a tax on non-cash benefits enjoyed or received by employees (including shareholder employees). These “fringe benefits” are not income, in the traditional sense, so are not subject to income tax, however, FBT recognises that they’re still essentially a payment for services provided so taxes them accordingly.
Source: Giles & Liew Chartered Accountants
Time is money...
Logging and calculating mileage numbers can be extremely time consuming for both the vehicle users (who are traditionally the recorders of this data) and the finance person responsible for submitting these numbers to IRD.
There are multiple ways to do this logging and calculation and every business is unique in this sense. However, the general consensus on this process is that it is inefficient. This inefficiency detracts employees from the tasks of their 'real' jobs - be it driving a fleet vehicle to their next customer or understanding the numbers in order to improve business efficiencies and ensure the business is compliant.
The days of log books are numbered
Not only is it time consuming, but the process of filling out log books relies solely on every single journey, both for personal and business use, being recorded accurately, honestly and legibly. This approach has the potential for human error. For every recorded kilometre there is risk of inaccurate data flowing through the entire accounting process.
Get actionable data at your finger tips...
The no pain, no gain mentality really doesn't need apply to this scenario. Instead, ArmadaGPS allows you to ditch the log books and handwritten entries. That's because it offers a feature called a 'Geofence' or 'Defined Places' within the GPS tracking system. In essence, these are little square boxes around certain addresses like 'customers', your own business address 'base' and your employee's home address. So, anytime Pete drives between 'Pete's House' and 'Base', for example, these trips are being automatically calculated for each and every journey duration and distance.
You just need a list of customers to get started
With ArmadaGPS, recording and data entry can take place with the push of a few buttons. Initially, the bigger your client base, the more 'Defined places' you'll need to set-up within your software. With just a list of customer names and addresses, this will just require input from someone with basic admin skills. The longterm pay off, however, is years of actionable data at your finger tips. You'll be able to pinpoint the exact hours and distance for personal use for each and every vehicle.
To find out more about empowering your business to make the right decisions read this blog or request a demo.
