ATO ID 2012/18: Exempt benefits: reimbursement of parking fees - remote area employees
Date of decision: 7 March 2012
Year of income: Year ending 31 March 2012
Business line: Superannuation and Employer Obligations

Issue
Where an employer reimburses an employee for fees incurred to park the employee's car at the local airport whilst the employee is working interstate at a remote location, will the reimbursement of the parking fees constitute an exempt benefit under paragraph 58G(1)(a) of the Fringe Benefits Tax Assessment Act 1986 (FBTAA)?

Decision
Yes. The reimbursement of the parking fees will constitute an exempt benefit under paragraph 58G(1)(a) of the FBTAA.

Facts
An employee's usual place of residence is situated in a major Australian city. The employee's primary place of employment is located at a mine site in a remote locality interstate. The employee works under a roster system which requires the employee, on a regular basis, to work for a number of days followed by a number of days off. At the commencement of each rostered period of working days, in order to get to the place of employment, the employee drives to the local airport and leaves their car at the airport car park and in so doing incurs car parking fees. The employee flies interstate and catches a connecting flight to a township near the mine site. At the completion of each rostered period of working days, the employee returns to his usual place of residence. The employer reimburses the employee for the parking fees incurred at the airport. The employer is not a non-profit organisation that could consider the application of either subsections 58G(2) or 58G(3) of the FBTAA. Division 10A - Car parking fringe benefits, of the FBTAA, does not apply in these circumstances for a number of reasons including that the employee's car is not being parked at or in the vicinity of the employee's primary place of employment.

Reasons for decision
Summary: Where an employer reimburses an employee for an expense incurred by the employee in these circumstances, an expense payment benefit can arise. However, in accordance with paragraph 58G(1)(a) of the FBTAA an expense payment benefit will be an exempt benefit where: 'Motor vehicle parking facilities' is not a defined term in the FBTAA. It is considered that any defined area which may be utilised for the purposes of parking motor vehicles would qualify as a 'motor vehicle parking facility'. Where the employee has incurred fees for parking a car at the airport car park, the employee has incurred expenditure in respect of the provision of motor vehicle parking facilities. In so doing the requirement of subparagraph 58G(1)(a)(i) of the FBTAA has been satisfied. The term 'eligible car parking expense payment benefit' is a defined term. For a benefit to be an 'eligible car parking expense payment benefit', paragraph (c) of the definition of the term in subsection 136(1) of the FBTAA requires that all of the following conditions must be satisfied: As the employee has parked the car at the local airport and the employee's primary place of employment is interstate, subparagraph (ii) of the definition has not been satisfied. Therefore, the expense payment benefit does not qualify as an 'eligible car parking expense payment benefit'. As a consequence, the requirement of subparagraph 58G(1)(a)(ii) of the FBTAA has been met. Accordingly the reimbursement of the parking fees will constitute an exempt benefit under paragraph 58G(1)(a) of the FBTAA.

Legislative references: Fringe Benefits Tax Assessment Act 1986 subsection 58G(1) subsection 136(1)
Subject references: Fringe Benefits Tax Exempt Benefits