• 11.3 Steps to take if you want to pay your employee a LAFHA

    If you pay your employee a LAFHA, you need to do the following:

    Step

    Action

    Section reference in this document

    1

    Ensure that the amount paid to the employee is in fact a LAFHA by definition.

    11.2, 11.13

    2

    a

    Calculate the taxable value of the LAFHA fringe benefit. This can vary, depending on whether:


    The employee is a temporary or foreign resident and the transitional rules apply

    11.4, 11.5, 11.6, 11.7, 11.10

    b

    The employee is not a temporary or foreign resident and the transitional rules apply

    11.4, 11.5, 11.6, 11.10

    c

    The employee maintains a home in Australia at which they usually reside and the fringe benefit relates to the first 12-month period, and the transitional rules do not apply

    11.4, 11.5, 11.6, 11.7, 11.8

    d

    The employee works on a fly-in fly-out or drive-in drive-out basis

    11.4, 11.5, 11.6, 11.7, 11.9

    e

    Any other circumstance applies

    11.4

    3

    Keep the appropriate records and declarations

    11.11 and Fringe benefits tax record keeping (chapter 4)

    4

    If required, report an amount as a reportable fringe benefit on the employee's payment summary (not as a taxable allowance).

    Reportable fringe benefits (chapter 5).

    If you are not paying a cash LAFHA to your employee, but rather are providing accommodation or food or drink, or reimbursing them for these expenses, see section 11.13 in this document.

      Last modified: 16 May 2017QC 17825