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Zone and overseas forces tax offsets

Check if you are eligible for a tax offset for living in a remote area or serving overseas as a member of a force.

25 April 2023

Zone tax offset

The zone tax offset is a tax offset for people who are residents of either:

  • specified remote areas
  • isolated areas of Australia.

This doesn't include an offshore oil or gas rig.

Remote areas are either Zone A or Zone B areas as specified in the Australian zone list. There are also special areas within these zones. Some new localities may meet the requirements to be in a special area but are not yet included in the Australian zone list.

Eligibility for the zone offset

We base your eligibility on your usual place of residence. To claim the zone tax offset your usual place of residence needs to be both:

  • a remote or isolated area (on the Australian zone list)
  • your residence for 183 days or more during the income year.

If your usual place of residence was in a zone for less than 183 days in the income year, you may still be able to claim the zone offset if:

  • your usual place of residence was in a zone for a continuous period of less than 5 years, and
    • you were unable to claim in the first year because it was not your residence for 183 days or more
    • the total of the days you lived there in the first year and the current income year is 183 days or more
    • the period you lived in a zone in the current income year includes the first day of the income year.
     

Examples of your usual place of residence

Start of example

Example: no residence in a prescribed zone

Levi is an engineer who lives in Adelaide. He flies to Alice Springs for 12-day shifts at an engineering firm. He then travels back to Adelaide for his days off (which vary between 4 and 8 days in a row).

Levi’s usual place of residence (Adelaide) is not within a prescribed zone, even though he is in Alice Springs for 183 days or more. This means he is unable to claim the zone tax offset.

End of example

 

Start of example

Example: residence in a remote area

Jonte is an engineer who lives in Darwin (located in Zone A). He travels to Kununurra in Western Australia (located in a Zone A special area) for his job in the mining industry.

In his usual shift, Jonte drives to Kununurra, works 14 days at the mine and drives back to Darwin, where he remains for 16 days.

Jonte is eligible for the Zone A tax offset because his usual place of residence is in Darwin (Zone A).

End of example

 

Start of example

Example: main residence outside Australia

Angela is a doctor who works in the Darwin Hospital emergency department. She flies into Darwin from Auckland, New Zealand, and works on a regular rotational basis in Darwin Hospital.

Usually, Angela works for 10 days and then has a break of between 8 and 10 days. During her breaks, Angela travels back to Auckland to see her friends and family. She stays in accommodation provided by the hospital when she is in Darwin.

Angela is purchasing a house in Auckland. She also has a car which she leaves at her Auckland home for use when she is there. Angela has bills sent to her Auckland home and she is registered to vote in New Zealand.

Angela isn't eligible for the zone tax offset. This is because her usual place of residence is in Auckland.

End of example

Note: Any discretion the Commissioner of Taxation exercises (under section 79A(3E) of the Income Tax Assessment Act 1936) will be made with reference to your usual place of residence.

Overseas forces tax offset

You may be eligible for an overseas forces tax offset if:

  • you are a member of either
    • the Australian Defence Force
    • a United Nations armed force
     
  • you serve in a specified overseas locality
  • your income relating to that service is not specifically exempt from tax.

If your income was exempt foreign employment income, exclude these periods when working out your eligibility for the tax offset.

To claim the full tax offset, you must have served in an overseas locality for 183 days or more in the income year. If your overseas service was less than 183 days, you may be able to claim part of the tax offset. Unlike the zone tax offset, you can't carry forward any unused days from previous years to make up 183 days.

Specified overseas localities

Table 1 below lists the current specified overseas localities. If you served in any of these localities as a member of the Australian Defence Force or United Nations armed force during the last income year, you may qualify for an overseas forces tax offset.

Table 1: Current specified overseas localities

Date the area became a specified locality

Date the area will cease to be a specified locality

Description of the specified locality

26 October 2011

The Republic of South Sudan and Uganda including superjacent airspace.

20 July 2006

Area comprising Lebanon and its territorial waters and superjacent airspace.

12 May 2006

Area comprising East Timor and its territorial waters and superjacent airspace.

28 October 2005

Area comprising the land, sea and air areas bounded by the internationally recognised borders of Pakistan.

10 April 2005

Sudan and its territorial waters and superjacent airspace.

24 July 2003

Total land areas, territorial waters and superjacent airspace boundaries of the Solomon Islands.

21 April 2003

Total land area, territorial waters and superjacent airspace within the internationally recognised boundaries of Israel, Jordan, Syria, Lebanon and Egypt.

11 June 1999

Area comprising the political boundaries and airspace of the Federal Republic of Yugoslavia (including the province of Kosovo), Albania and the former Yugoslav Republic of Macedonia.

28 October 1992

The Sinai.

Former specified overseas localities

Table 2 below lists the specified overseas localities that are no longer current. You may be able to claim the overseas forces tax offset in the income year you served there.

When working this out, if you were in the area on the date the area:

  • became a specified locality, include that day in your calculation
  • ceased to be a specified locality, exclude that day from the calculation.
Table 2: Former specified overseas localities

Date the area became a specified locality

Date the area ceased to be a specified locality

Description of the specified locality

1 July 2014

30 June 2015

For service with Operation OKRA, the land territory, territorial waters, airspace and superjacent airspace of the:

  • State of Kuwait
  • Kingdom of Bahrain
  • United Arab Emirates
  • State of Qatar
  • Hashemite Kingdom of Jordan.
 

1 July 2014

30 June 2015

For service with Operation OKRA, the waters, airspace and superjacent airspace of the Persian Gulf. (Also known as the Arabian Gulf.)

1 July 2014

31 December 2014

For service with Operation Accordion, the land territory, internal waters, airspace and superjacent airspace of:

  • the Kingdom of Bahrain
  • the State of Qatar
  • the United Arab Emirates.
 

1 July 2014

30 June 2015

For service with Operation Manitou, the sea (including adjacent ports and the area within a 10 km radius of such ports) and superjacent airspace of the:

  • Arabian Sea, north of latitude 12 degrees South and west of longitude 68 degrees east
  • Persian Gulf
  • Strait of Hormuz
  • Gulf of Oman
  • Gulf of Aden
  • Red Sea.
 

31 March 2011

1 November 2011

International waters and superjacent airspace of the Central Southern Mediterranean Sea:

  • between 10 00' E and 28 00' E and south of 41 00' N
  • including portions of Italy, Greece, Turkey, Albania and all of Malta and north of Libya, and
  • its territorial waters and superjacent airspace.
 

20 May 2004

18 August 2009

East Timor and the territorial sea of East Timor.

18 August 2003

18 August 2009

Total land area, territorial waters and superjacent airspace of East Timor.

15 January 2001

18 August 2009

Area of operations defined as comprising Ethiopia and Eritrea.

4 November 2000

18 August 2009

Area of operations defined as comprising the Solomon Islands and its territorial sea.

19 June 1999

18 August 2009

Area comprising East Timor and the territorial sea of Indonesia adjacent to East Timor.

12 July 1994

18 August 2009

Mozambique.

7 July 1994

18 August 2009

Cambodia.

7 May 1991

18 August 2009

The waters of the:

  • Arabian Gulf, Gulf of Oman, Northern Arabian Sea, the Gulf of Aden and the Red Sea
  • bounded to the south and east by the following coordinates
    • 25 00' N – 61 50' E
    • 20 00' N – 61 50' E
    • 11 50' N – 51 17' E.
     
 

1 July 1970

18 August 2009

The areas in:

  • Syria, the Arab Republic of Egypt, Jordan, Lebanon and Israel, including territories occupied by Israel,
  • in which Australian personnel served with the United Nations Truce Supervision Organisation.
 

16 September 1963

18 August 2009

Malaysia and its contiguous waters for a distance of 100 nautical miles seaward.

26 December 2004

27 May 2005

Area comprising of the land, sea and air areas bounded by the following geographical points:

  • 7 deg north 94 deg east
  • 7 deg north 108 deg east
  • 7 deg south 94 deg east
  • 7 deg south 108 deg east.
 

20 November 1997

27 August 2003

Area comprising Bougainville, Buka Islands and the Papua New Guinea territorial waters surrounding those islands.

15 January 2001

28 February 2003

The specified area comprises Sierra Leone.

1 October 1999

12 January 2003

Area of operations comprising the political borders of Iraq, Kuwait and Saudi Arabia.

13 May 1999

12 January 2003

Area of operations comprising the political borders of Iraq, Kuwait and Saudi Arabia.

15 May 1999

19 October 2001

The sea area:

  • comprising the Arabian Gulf, the Gulf of Oman and the northern Arabian Sea
  • bounded by 61 degrees 50 minutes east longitude and 20 degrees north latitude
  • together with the ports contiguous to that sea area and the airfields and military facilities adjacent to those ports.
 

1 October 2001

Area of operations all sea, airspace and land North and West from 5 deg 00 min S 68 deg 00 min E and encompassing the outer boundaries of Pakistan, Afghanistan, Iran, Iraq, Jordan, Egypt, Sudan and Kenya.

8 June 2000

25 June 2000

Area of operations defined as comprising:

  • the island of Guadalcanal and the adjacent waters
  • extending 12 nautical miles (including the superjacent airspace) from the shoreline of the island of Guadalcanal.
 

5 October 1999

Area of operations comprising Cambodia and the areas in Laos and Thailand that are not more than 50 kms from the border with Cambodia.

6 September 1999

20 September 1999

Area comprising East Timor and the territorial sea of Indonesia adjacent to East Timor.

25 February 1999

11 June 1999

Area comprising the political boundaries and airspace of:

  • the Federal Republic of Yugoslavia (including the province of Kosovo)
  • Albania
  • the former Yugoslav Republic of Macedonia.
 

15 April 1999

4 June 1999

Area comprising the political boundaries and airspace of:

  • the Federal Republic of Yugoslavia (including the province of Kosovo)
  • Albania
  • the former Yugoslav Republic of Macedonia
  • the air bases in Italy used for this operation
  • the Adriatic Sea.
 

13 February 1997

13 May 1997

Guatemala.

1 July 1996

Haiti.

21 February 1995

Rwanda and the areas of Uganda, Zaire, Burundi and Tanzania that are not more than 50 kms from the border with Rwanda.

21 September 1994

13 November 1994

Bougainville, the Buka Islands and the Papua New Guinea territorial waters surrounding those islands.

1 August 1994

The countries of:

  • Bahrain
  • Iraq
  • Kuwait
  • Oman
  • Qatar
  • Saudi Arabia
  • the United Arab Emirates
  • Turkey, south of latitude 38 north
  • Western Sahara.
 

1 January 1994

The North West Frontier Province of Pakistan and Afghanistan.

8 October 1993

21 November 1993

Cambodia.

1 January 1991

The area in which Australian Defence Force members are serving with the United Nations Iran or Iraq Military Observer Group:

  • on the Iran side of the internationally recognised border between Iran and Iraq
  • being an area within 200 kms of that border.
 

1 February 1990

The areas in Uganda in which Australian military personnel served with the Australian Contingent Commonwealth Military Training Team.

1 February 1990

The areas in Sinai in which Australian military personnel served with the Multi-National Force and Observers (MFO).

1 February 1990

The areas in India and Pakistan in which Australian personnel served with the United Nations Military Observer Group, India and Pakistan.

1 February 1990

Indonesia.

1 February 1990

Vietnam (southern zone) and the waters contiguous to the coast of Vietnam for a distance of 100 nautical miles seaward.

1 February 1990

Thailand.

1 February 1990

The waters contiguous to the coast of Singapore for a distance of 100 nautical miles seaward.

1 February 1990

Brunei and the waters contiguous to Brunei for a distance of 100 nautical miles seaward.

Calculate and claim the zone or overseas forces tax offset

You need to calculate the tax offset and claim the amount in your tax return at Zone or overseas forces.

You can only claim one of these tax offsets. If you qualify for both, you can claim the one that gives you the greater offset amount.

Use the calculator to work out your eligibility for a tax offset and the amount to claim.

Zone or overseas forces tax offset calculator

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