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Edited version of your written advice
Authorisation Number: 1013035621934
Date of advice: 17 June 2016
Ruling
Subject: Fringe benefits tax
Question 1
Will the housing accommodation provided to an employee be an exempt remote area housing benefit under section 58ZC of the Fringe Benefits Tax Assessment Act 1986?
Answer
Yes
This ruling applies for the following periods:
Year ended 31 March 2017
Year ended 31 March 2018
Year ended 31 March 2019
The scheme commences on:
2012
Relevant facts and circumstances
This ruling is based on the facts stated in the description of the scheme that is set out below. If your circumstances are materially different from these facts, this ruling has no effect and you cannot rely on it. The fact sheet has more information about relying on your private ruling.
You are the named party on a lease for a unit of housing accommodation. This house is made available to an employee to reside in. The employee has entered into a salary sacrifice arrangement with you and will forgo remuneration as salary in return for the right to use the house.
You provide subsidised housing to other employees and the provision of housing is considered customary within your industry.
You have previously received private rulings on this arrangement advising that, at the time, the provision of housing to the employee was an exempt benefit under section 58ZC of the Fringe Benefits Tax Assessment Act 1986 (FBTAA). These rulings have expired.
The employee has now purchased accommodation within the town but the employee does not reside in it and has no intention of doing so. The property is rented out and was bought for investment purposes.
Relevant legislative provisions
Fringe Benefits Tax Assessment Act 1986 section 58ZC.
Reasons for decision
While these reasons are not part of the private ruling, we provide them to help you to understand how we reached our decision.
Summary
The housing accommodation provided to your employee is an exempt remote area housing benefit under section 58ZC of the FBTAA.
Detailed reasoning
You have previously been issued with private rulings stating that the provision of accommodation to your employee is an exempt benefit in accordance with section 58ZC of the FBTAA.
The only change in circumstances has been that your employee has purchased a property within the town for investment purposes. Your employee will not be living at that property.
The housing benefit that you provide is an exempt benefit under section 58ZC of the FBTAA as:
• the accommodation and your employee's usual place of employment are located in a remote area
• it is necessary for you to provide that accommodation as it is considered customary within your industry to provide subsidised housing and
• you have not provided the accommodation under a non-arm's length arrangement or for the purpose of enabling you to obtain the remote area housing benefit exemption.
The fact that your employee has purchased a property within the town for investment purposes does alter this conclusion.