The Australian Taxation Office (ATO) has recently released a
series of new living away from home declarations (the declarations)
as a result of the legislative reforms to the taxation treatment of
living away from home allowance (LAFHA).
An employee who lives away from his/her normal residence during
a fringe benefits tax (FBT) year is required to provide his/her
employer a declaration, in a form approved by the Commissioner, by
the date of lodgement of the FBT return, containing the following
the employee's normal residence; and
the place at which the employee resided during the period
he/she received the LAFHA.
To that end the ATO has released the following types of LAFH
declarations, to be completed according to the circumstances of the
The employee received a LAFHA before 1 October 2012 or is a
permanent resident qualifying for the transitional rules from 1
The employee works on a fly-in fly-out (FIFO) or drive-in
drive-out (DIDO) basis;
The employee received a LAFHA from 1 October 2012 and maintains
an Australian home.
It should be noted that unlike the previous versions of the
declarations, the employee is also required to complete a
declaration setting out the accommodation expenses incurred as well
as food and drink expenses that are not considered reasonable.
Where the employee provides a declaration to the employer, the
employee must retain the relevant documents to substantiate the
expenses incurred for a period of five years from the declaration
Copies of the declarations and further details can be found
using the following link:
Employers should ensure that appropriate measures are in place
to enable their employees who are receiving LAFHAs to complete the
However, it remains uncertain as to whether the ATO would
exercise any discretion with respect to scenarios where employers
has taken reasonable care in requiring employees to complete the
appropriate declarations but subsequently found to be incorrect by
the ATO during an audit.
The income tax treatment of any property lease incentive will vary, depending on the nature of the inducement provided.
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