Expat international can provide you with global coverage for all your mobility requirements

We are represented on every continent with partners offering the same high quality and customised service that we do.

The Captcha image Reload Image

Blog

LAFHA (Living Away From Home Allowance) Transitional Arrangements Scrapped According to Australian Treasury Briefing … May 17, 2012.

  • By Expat
  • May 25, 2012

Commencing 1.7.2012, temporary resident visa holders will no longer be eligible to receive the LAFHA unless they are required to live in a different location for work, whilst maintaining a home for their own use elsewhere in Australia.
While the above Treasuring information has not yet been legislated, it is expected to be, without changes, in the early part of June.
The absence of any form or transition arrangement for established employment contracts is a shock to both affected employees, and their employers.   To ensure compliance with employment law, employers must judiciously and with urgency, consider all current employment contracts and supplementary arrangements to evaluate the establishing options going forward from July 1, 2012, including remuneration and policies.
The Department of Treasury’s document dated May 17 documents the changes that apply from July 1 2012.  These are:
• Living Away From Home tax concessions will be limited to workers who maintain a residence for their own use in Australia, that they are required to live away from for work; and
• all individuals will be required to substantiate their actual expenditure on accommodation, and food beyond a statutory amount.
• a 12 month time limit will be imposed on how long an employee can receive the tax concession at a particular work location.
However, the new amendments do not affect the tax treatments for  …
• ‘fly-in fly-out’ workers, as these employees will not be subject to the 12 month time limit;
• travel and meal allowances provided to employees who must travel from their usual place of work for short periods of up to 21 days.
Full details are available at:
http://ministers.treasury.gov.au
The impact of the new reforms could well be serious for firms already facing real difficulty in filling professional and technical positions from within our own workforce, and thus pressed to supplement from overseas.   LAFHA has been an incentive for many to move temporarily to Australia, with the end result of many of those seeking to become Permanent Residents, thereby swelling our capability pool, and significantly adding to Australia’s economy.
It is likewise regrettable that so little lead time has been allocated to these weighty changes that will impact all concerned, allowing a mere 5 weeks for employers to establish their strategies for devising new financial arrangements for temporary visa holders in particular.