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Ruling
Subject: Reporting of site allowances on payment summaries
Question
Should a site allowance be reported on an employee's annual payment summary in the gross payments section?
Answer
Yes.
This ruling applies for the following period
Year ended 30 June 2012
The scheme commenced on
1 July 2011
Relevant facts
Some employees received site allowances.
You have withheld tax from these payments and included the amount in the gross payments for each employee on their payment summary.
The site allowance is paid as an additional payment per hour, the rate depending on the location. If an employee is away overnight they drive the employer's vehicle and the employer pays all expenses.
Relevant legislative provisions
Taxation Administration Act 1953 - Schedule 1 Part 2-5
Reasons for decision
The site allowance is an extra amount paid per hour due to working conditions, qualifications or special duties. The rate varies depending on the site. As per the Fact Sheet - Withholding from allowances, available on the ATO website www.ato.gov.au the site allowance is subject to PAYG withholding and the total allowance should be shown in the gross payments section of the payment summary for each employee.
It does not matter that the employees are paid the site allowance when they are away overnight. It is not compensation for the extra costs the employees incur for being away overnight. It is not the equivalent to an overtime meal allowance or travel allowance or an allowance for expected deductible expenses. The employer provides a vehicle for travel and meets all other expenses when the employee is away overnight. The site allowance is paid by the employer, in addition to meeting these expenses.