On 29 November 2011, the government announced reforms to the fringe benefits tax (FBT) treatment of living-away-from-home allowances and benefits. Additions to these reforms were later announced in the 2012-13 federal Budget, when the legislation was introduced into parliament on 28 June 2012, and during subsequent debate.
The additions ensured that living-away-from-home allowances and benefits are taxed entirely within the FBT system, rather than in the personal income tax system, or a combination of both.
The amendments to the law generally take effect from 1 October 2012 - however, there are some transitional rules.
The reforms limit the concessional FBT treatment of living-away-from-home allowances and benefits provided to employees who maintain a home in Australia, but who are required to live away from that home because of the duties of their employment. The concessional treatment is limited to a period of 12 months for an employee at a particular work location.
Employees must be able to substantiate expenses incurred on accommodation, and food or drink (beyond the Commissioner of Taxation's reasonable amount).
Employees must provide the employer with a declaration relating to living away from home.
Special rules apply to employees who are working on a fly-in fly-out or drive-in drive-out basis.
Transitional rules apply to permanent residents who have employment arrangements for living-away-from-home allowances and benefits in place prior to 7.30pm (AEST) on 8 May 2012.
Transitional rules also apply to temporary or foreign residents who maintain a home in Australia that their duties of employment require them to live away from, and have employment arrangements for living-away-from-home allowances and benefits in place prior to 7.30pm (AEST) on 8 May 2012.
The reforms received royal assent on 28 September 2012.
Refer to:
- media release no. 106, Reforms to Living-Away-From-Home Allowances and Benefits Passed by the Parliament, issued by the Assistant Treasurer on 19 September 2012
- media release no. 088, Government welcomes passage of reforms to living-away-from-home allowances and benefits through the House of Representatives, issued by the Assistant Treasurer on 21 August 2012
- media release no. 055, Tax changes to living-away-from-home allowances and benefits introduced into Parliament, issued by the Assistant Treasurer on 28 June 2012
- media release no. 029, Reform of living-away-from-home allowances and benefits - draft legislation released for consultation, issued by the Assistant Treasurer on 15 May 2012
- media release no. 148, Tax measures in mid-year economic and fiscal outlook, issued by the Treasurer on 29 November 2011
The following legislation received royal assent on 28 September 2012:
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For more information, refer to the:
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Last Modified: Monday, 25 March 2013