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Living Away from Home Arrangements - Legislation Announcements

 

Unfortunately, the legislation has not changed much from the announcement, so the news is still bad.


The only substantial change is that the commencement date of the changes has been deferred three months until 1 October 2012, instead of
the previously announced 1 July 2012.

The new law will treat living away from home allowances as part of an employee's assessable
income rather than as fringe benefits.

An employee with a living away from home allowance can claim a deduction, but only where the
employee maintains a home in Australia for his or her own personal use
at all times they live away from.  This is limited to the first 12
months the employee is at any particular location. And the deduction is
limited to reasonable expenses incurred and substantiated for
accommodation and food and drink.

There is a further change in relation to the way reasonable food and drink is calculated compared to
announcements.  Under this legislation, the ordinary weekly food and
drink expenses amount is $42 for adults and $21 for children under 12 so
a deduction will not be available for amounts spent above this.

Employers will pay FBT on living away from home benefits, under similar rules,
but not FBT concessions for fly-in fly-out arrangements. It also does
not affect travel and meal allowances provided to employees who have to
travel from their usual place of work for short periods, generally up to
21 days.

The transition provisions means the old rules continue for those employees lucky enough to have a living away from home
allowance or a living away from home benefit in place under a contract
entered into before budget night (8 May 2012).  But only until varied or
1 July 2014.

Some practical implications:

  • You can put a house sitter in the house you are living away from but the house sitter
    cannot be charged rent for house sitting and they must vacate when you
    return
  • You cannot rent out the house you are living away from that you must maintain. Nor can you sub-lease a house you are renting
    that you are living away from.

 

 



6th-November-2012