Institute of Certified Bookkeepers
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professional development expense allowance

  • Member in Practice
  • Practice Certificate
  • 2 posts
  • # 118150

A client wishes to provide all staff with a professional development allowance up to a certain value. this is writen into the employement contract, with a reimbursement policy to accompany this, outlining that the PD allowance will be paid/reimbursed on provision of invoices ie fully expensed. Does this constitute a non taxable allowance ie no paygw? should it be shown at allowances for STP , or does it constitute a reimbursement - not salary and deductible to the business as an expense and subject to FBT , although exempt under otherwise deductible.

thanks

  • 34 posts
  • # 119146

You can claim exemption to the extent of expenditure incurred for official purposes. As per rules, it is on actual basis and hence prior approval of academic research/professional pursuits and tracking spending etc. could be required for smooth accounting and audit.

  • 1 post
  • # 119565

EmD said:

A client wishes to provide all staff with a professional development allowance up to a certain value. this is writen into the employement contract, with a reimbursement policy to accompany this, outlining that the PD allowance will be paid/reimbursed on provision of invoices ie fully expensed. Does this constitute a non taxable allowance ie no paygw? should it be shown at allowances for STP , or does it constitute a reimbursement - not salary and deductible to the business as an expense and subject to FBT , although exempt under otherwise deductible.

thanks


 

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  • Fellow in Practice
  • Practice Certificate
  • 277 posts
  • # 119570

If they are effectively doing it as a reimbursement then why dont the just pay it outside of wages  as a true reimbursement.  If it is paid as an allowance then PAYG would need to be withheld for them to then claim back at the end of the financial year.

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