• 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).

    Further information

    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.

    End of further information
      Last modified: 23 Aug 2013QC 17825