The ATO has reminded employers to consider their tax and super obligations when employees are provided with incentives or rewards for getting their COVID-19 vaccination.
When employees are provided a cash payment, including paid leave for employees to get their COVID-19 vaccination (or additional paid leave to recover from any vaccination side effects), employers should withhold PAYG withholding and make super contributions on the amount.
Furthermore, the payment must be reported to the ATO via Single Touch Payroll (‘STP’) as part of the employee’s salary or wage.
On the other hand, employers must consider the FBT consequences of providing non-cash benefits as an incentive for their employees to get vaccinated.
Such benefits may include:
- Goods or services provided to the employee
- Vouchers and gift cards
- Prizes won by an employee in a competition (e.g., a raffle).
Note that certain FBT exemptions and reductions may apply in some circumstances. For example, if an employer provides or pays for an employee’s transport to get their COVID-19 vaccination, there is generally no FBT payable.
If you would like to know more about tax considerations for COVID-19 vaccination reward schemes, please contact our team on 03 9708 8801 or email firstname.lastname@example.org for further information.
Please Note: Many of the comments in this publication are general in nature and anyone intending to apply the information to practical circumstances should seek professional advice to independently verify their interpretation and the information’s applicability to their particular circumstances. The information contained within this document is of a general nature only and neither represents nor is intended to be personal advice on any particular matter. Robinson Voss Partners (RV Partners) strongly suggests that no person should act specifically on the basis of the information in this document, but should obtain appropriate professional advice based on their own personal circumstances.