Anthony998

Hello all,

I've recently been sponsored and am now on a 457 long stay visa having started with a civil engineering company in Canberra, ACT. I started work with them this year and when I brought up LAFHA in a discussion with our accounts department I was met with blank stares. Apparently they'd never heard of it before. So, long story short, I've been here four weeks now and they are only paying me the accommodation allowance component of LAFHA.

Now, when I compare my weekly payslip to that of a comparable one I received while working in Melbourne doing 40 hours a week but for more money and being paid through a 3rd party company (Payfair & Job-Capital) I see that my LAFHA allowance when paid through a 3rd party was significantly different. I mentioned this to the accounts department and they did a bit of research and I did a little of my own too. It seems they are refusing to pay me the food component of LAFHA because they think they'll have to pay Fringe Benefits Tax (FBT) on it. However, even if they give me the food component allowance of LAFHA it still wouldn't, in conjunction with the accom. allowance, add up to what I was being allowed in Melbourne.

It is all very unclear to me and to them. I'll give you a rough summary of my allowances based upon comparable salaries received in both Melbourne and Canberra.

My LAFHA allowance on my payslip in Melbourne was around the $1,000/ week mark but was calculated by two companies (over the course of my employment) specialising in this.

In contrast, my current employer is only giving me an allowance of $335/week which is what I pay in rent. Am I entitled to more? I've been told my friends (working elsewhere) that they're receiving more but when it came to why they were all at a loss.

Can someone please assist me in resolving this?

Thank you for your patience in this regard and I appreciate any help you give,

Anthony

Hino

Phone the ATO ( Australian Tax Office ).

They are a great source of free and accurate information regarding these matters.

I hope you manage to get the problem sorted

eddie007

Wow i'm in the wrong job... Either that or I dont eat enough

ABCDiamond

Not too sure about the ATO, they do give free info, but you need to be able to understand it, in their language

One option is to pay for a specialist LAFHA firm to explain it to the employer, and relax their worries about FBT being paid.
They are right to worry though, as there are occasions when it is done wrong and the employer is the one that the ATO come to for the extra tax to be collected, NOT the employee who gets the benefit.

Amazulu

Tell them to sort it out to your satisfaction or they can shove their job where the sun don't shine.

You're a civil engineer, there's hardly a shortage of work in Australia for you guys.

goldchoccycoin

I think it may be that your current employers are sticking to the exact rules - as in - your rent is $350 per week so you get $350 per week LAFHA. Previously, maybe the other employers were using the 'reasonable limits' for your rent and allowing a greater amount.

I could of course be completly wrong...

Still doesn't explain why they won't offer the food component!