Taxpayers are entitled to a general deduction for the annual fees incurred on an airport lounge membership for use by its employees where that membership is provided because of the employment relationship.
However, the annual fees incurred will not be deductible to the extent the annual fees are incurred in relation to gaining or producing exempt income or non-assessable non-exempt income.
Is also important to note that the annual fees will be deductible in full even if there is substantial private use of the lounge membership by employees, for example, the membership is used while on holiday.
And when it comes to the Fringe Benefits Tax Assessment Act, the expense payment benefit or a property benefit provided by an employer that relates to an airport lounge membership is also considered exempt from fringe benefits tax.
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