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A fringe benefit is kind of pay that is given to the employee based on his or her performance for their services. This fringe benefit provided is also taxable and can be included in the pay of the recipient of the particular fringe benefits. These amounts affect the employees’ gross income which indirectly affects the company’s payroll. There are some cash fringe benefits and some are non-cash fringe benefits. Fringe benefits rates are not fixed; it is depended on changes in the policy and law. Given below are some examples of the employee fringe benefits that are being provided to the employee based on their performance in a given time.
List of fringe benefits:
- Personal use of a company car
- Company Health Saving Accounts contribution
- Group Term Life Insurance
- Clergy Housing
- Non-taxable per Diem
- S-Corp Owners health insurance
- Cafeteria plans
- Employee discounts
- Childcare assistance
How To Set Up Taxable Fringe Benefits Payroll Item In QuickBooks:
- Go to the Menu, click on List > Payroll Item list.
- Click on Payroll Item button and select New.
- Choose Custom Setup.
- Select Company Contribution ( this adds the value of fringe ) or Addition ( the value of fringe that has to be taxed, thus affects the net pay ). Click on Next.
- Enter the name of the item and click on Next.
- Select expense and liability accounts and click on Next.
- Click on Fringe Benefits from Tax Tracking Type and proceed to Next.
- Just keep on clicking on Next for two times. You will be then transferred to Calculate Based on Quantity windows.
- Enter the amount in the first section of the Limit Type windows.
- If there is any limit on that item, then proceed to other section of Limit Type windows and again enter the amount.
- Click on Finish and you are done.
After This, It Is Decided How To Pay Employee Fringe Benefits:
- Whether the amount should be included in the paycheck of the employee where he or she is provided with regular wages.
- If the employee won’t be receiving the further wages for the year and employer will be loaning tax amount to the employee.
- If the employee won’t be receiving the further wages for the year and the employer will be the one paying the taxes.
Employee fringe benefits provided to the employees can also be tracked and a report can be generated in QuickBooks to view the details of it.
But as we know, for new users understanding the functionalities and details about the QuickBooks might not be that easy task. So simply the purpose of solving the issues, QuickBooks has provided an online support system is available 24/7 for the user. If the user finds any difficulty related to Employee Fringe Benefits, all you have to do is get your phone and dial the following QuickBooks online support number: +18772499444. We aim to provide the best solution to our customers’ problems that would thus help them to have a better understanding of the business concepts using the training materials.