Airline Lounge Memberships Deductible

A recent tax determination (TD 2016/15) has confirmed that the annual airline lounge membership fee for airport lounges is deductible if the membership holder has an employment relationship with the bill payer.

The determination states that the annual fees are deductible in full even if there is substantial private use of the lounge by the employees. For example, the membership is used whilst on holiday.

Note also that the payment will not be subject to fringe benefits tax because the FBT Act specifically makes airport lounge benefits exempt from FBT.

It’s a small thing, but one that is perhaps a way of rewarding key employees without creating tax or FBT issues for the employer.

If you have any queries, please don’t hesitate to contact us for more information.