ATO ID 2006/333: Exempt Benefits: meals on working days - benefit consisting of a meal that is ready for consumption
Date of decision: 14 November 2006
Year of income: Year ended 31 March 2007
Business line: Private Groups and High Wealth Individuals

Issue
Where an employee is provided with uncooked meat and vegetables on a working day, has a benefit been provided that consists of 'a meal that is ready for consumption' in accordance with paragraph 58ZD(c) of the Fringe Benefits Tax Assessment Act 1986 (FBTAA)?

Decision
No. Food provided to an employee on a working day, which requires the employee to prepare in order to be eaten, is not considered to be a benefit consisting of a meal that is ready for consumption pursuant to paragraph 58ZD(c) of the FBTAA.

Facts
The employer carries on a business of primary production in a remote area. The employer provides their employee with free meat and vegetables on a working day. However the employee is required to prepare the food for it to be eaten. The circumstance under which the food is supplied does not amount to meal entertainment for the purposes of section 37AD of the FBTAA.

Reasons for decision
Summary: Section 58ZD of the FBTAA exempts from fringe benefits tax certain benefits consisting of a meal provided by employers carrying on the business of primary production. Each of the conditions as specified in section 58ZD of the FBTAA must be met before the benefit can be an exempt benefit. Paragraph 58ZD(c) of the FBTAA requires that the benefit provided to an employee on a working day consists of a meal that is ready for consumption. The explanatory memorandum to the A New Tax System (Fringe Benefits) Bill 2000 that introduced section 58ZD of the FBTAA does not define what is meant by 'meals' and 'ready'. As such they would be interpreted on the basis of their ordinary meaning. Meal is defined in the Macquarie Dictionary , [Multimedia], version 5.0.0, 1/10/01 as: Ready is also defined in the Macquarie Dictionary , [Multimedia], version 5.0.0, 1/10/01 as: The food which has been provided to the employee does not consist in its raw form, of a meal that is completely prepared for immediate use. Accordingly such food is not considered to be a benefit consisting of a meal that is ready for consumption pursuant to paragraph 58ZD(c) of the FBTAA.

Legislative references: Fringe Benefits Tax Assessment Act 1986 section 58ZD paragraph 58ZD(c)
Related ATO interpretative decisions: ATO ID 2005/109
Other references: The Macquarie Dictionary, [Multimedia], version 5.0.0, 1/10/01. A New Tax System (Fringe Benefits) Bill 2000
Subject references: Exempt benefits Fringe benefits tax