Hi,

I came to Sydney from the UK 18 months ago and was receiving LAFHA from my employer. Unfortunately I was made redundant in August but was offered another job by a new employer. My new employer is willing to give me a LAFHA allowance but he thinks it may be disallowed as I was in Australia when he offered me the job.I still have a house in the UK that I let out. Is the LAFHA allowance still available to me? I would only be claiming for rent and not food so there would be no FBT implications for my new employer.Also can I salary sacrifice the school fees for my two kids?

I cant answer the salary sacrifice for the school fees bit - you would have to ask an accountant !

However I dont see why you cannot get the LAFHA. I read somewhere that LAFHA can also be claimed oz citizens who are working away from home in another part of Oz - ie it doesnt have to apply to temporary workers coming from overseas to work here.

Colin,

I believe your argument may fall down on one aspect : I need the LAFHA during my stay in Sydney. I agree that I would get LAFHA if I worked in Sydney, was renting a unit here and was posted to Brisbane for six months.

My fear is that the ATO might take the view that, by taking the job with my new employer( and working and residing in Sydney), I have shown an intention to stay in Australia beyond the service of my first job that was made redundant.

I need to get some assurance for my new employer that he will not be hounded by the ATO for any FBT if the LAFHA is investigated and found to be given by him illegaly.

What do you think I can do to convince him?

Hi there,

I dont believe my argument will fall down at all. You are eligible to claim LAFHA until such times as you make a decision that you will NOT return to your home country.

I assume that you still want to stay here for the meantime and that you haven't as yet applied for a Permanent Visa - so I dont see where the problem is - but then I am not an accountant nor a migration expert so I suggest you seek professional help if you really want to be sure and in order to convince your new employer !

Colin,

I phoned up ATO and the guy reckons I can get LAFHA as I pass all the criteria.

One other question for you !

I am getting paid $80000 with a $30000 LAFHA deduction from the gross pay and I'm taxed on $50000 which gives me cash in pocket equivalent of $95000 gross. What should I be getting my superannuation calculated on? Should it be $80000 or $50000?

Hi,

I dont quite understand where you get $95,000 from - but it doesnt matter anyway - the super contribution should be 9% of your gross income ie $80,000 - LAFHA has no effect on super.

Have just done sone quick calcs and I reckon that should receive (after tax and medicare) $69,650 which is $5804 per month.