FavouriteFlavia

I left the UK and moved to Melbourne in September to start a new job, which I had lined up. My Australian employer has denied me LAFHA, because they say I am on a "permanent" contract even though there is a one year probabionary clause and they have only sponsored me on a 4 year 457 via. Is this normal and correct? Flavia

newjersey

If you read recent news on LAFHA, you will find that it is about to be abolished for situation like yours, so I doubt you will get much debate.

Bermudashorts

It is up to them. They don't have to provide LAFHA and as NJ says it is going away for most anyway, so I wouldn't waste my energy on the debate.

alexswift

Its going away for none residents anyway so by the time it would have been set-up with your pay dept it would be all over anyway.

Re on a 457 visa and a perm employment contract, I had the same issue because my contract did not say a it was a secondment or temp contract. HOWEVER you are on a 457 so you MUST exit the country be it only for a weekend trip to NZ at the end of the 4 years. So by definition you are here on a temp basis.

The other point to watch out for is, at the moment "your intention is to return home after 4 years" so the moment you decide "you are staying here" and apply for a permanent visa "your intention" has changed the move is permanent so LAFHA changes.

And when you do your tax return you will make this claim.

bingobob777

They are wrong.

Ian Lindgren

Hi,

I just want to clarify this one for you because some of the posts are wrong, ie LAFHA has not been abolished, it’s just that most people will lose it, so I expect you might be a bit confused.

Let’s address things as they are now until 30 June which is the date we expect, and I say expect, that the government will change LAFHA eligibility criteria. There are many considerations for someone being eligible for LAFHA, however only two have to be satisfied for you to be eligible, these are:

• You must intend to return home (and therefore not have applied for permanent residency), and
  
• You must pass the “But For” Test. This is “but for” having to change residence in order to work temporarily in Australia for your temporary Australian employer, you would have stayed at home. This is applies to any employer you work for.

If you did not sign a contract with your employer before you left home, this has no bearing.

All employees in Australia that are working full time are on “permanent” contracts as defined by the Fair Work Act, so that has no bearing. What is more, if you are on a 457 Visa and you intend to go home, and your employer is splitting hairs about the definition of the word “permanent”, let’s face facts, you are going home at the end of your visa, so if they define permanent differently than the Fair Work Act (which they cannot), they must redefine it as temporary, because you will go home and therefore it is not a permanent contract that you will stay in indefinitely and forever!

I have attached an employer’s Brief on LAFHA; feel free to give this to your employer.

Now the only hitch is that while you may be eligible for LAFHA, it is likely that you will become ineligible on 1 July 2012. So you can be paid it up until that date if your employer agrees to. Just remember it is not an entitlement; it is only paid if your employer choses to pay it.
What’s happened in this…the government has outlined its intention to change the qualifying conditions for LAFHA as of 1 July 2012. So this is just intent, and no legislative changes have been presented to the parliament t to consider, so while that is the case, all we can do is speculate as to what might be law after 1 July. But it’s most likely to happen.
Essentially what has been indicated is that from 1 July onwards in order to be eligible:

• You will have moved to Australia and purchased or rented a property, no consideration about having previously lived overseas will be taken into account.
  
• You will need to be asked by your employer to move temporarily to a new location,
  
• You must leave you owned or rented property vacant, or with some of your family remaining in it, so you are fully paying to maintain it
  
• Move to the new location, and
  
• Rent.

Obviously this is a major change. If we can assist in any way, don't hesitate to contact us, or any other LAFHA advisor.

Regards,

Ian

Dreamy

Why do you have to leave the country?

If you are granted a new 457 you don't have to leave. Obviously, if you aren't granted a new one they kick you out.

Amazulu

That's my understanding too.

Alan Collett

Actually, I don't think you do ...

Best regards.

paddyo

Er....not sure you have that all correct old chap. You can apply for an get a PR 'in country' whilst on a 457 Visa.
The 'intention' is always there until you actually get the PR, looking at it objectively. Even if you apply, you would always assume that if you don't get it then you would remain on your 457 until that runs out. Its doable but needs a bit of IMMI admin to resolve and I'm not best placed to provide any amplification.
To the OP.....irrespective of whether or not you are eligible or if it is going in July or not, if your employer does NOT want to give it to you then they do NOT have to. Bit of a bummer hey!

markbhx

I spent 3 years on a 457 and my employer/ sponsor said the company does not offer LAFHA, I missed out on about 100 grand :-(

markbhx

And I think this confirms it is at employers discretion http://www.austpayroll.com.au/announ...expert-lafha-7

Ian Lindgren

Hi,

Just a quick update on LAFHA because as you know the government has indicated that it is about to radically change the eligibility criteria on 1 July.

Read the LAFHA Blog to receive the facts in real time as this situation becomes clearer.

Regards,

Ian

LeeWillo

Hi, I am currently in Oz on a 457 visa, I get LAFHA allowance. I own a house in the UK which I rent out, and I rent one here. I understand there are to be changes or stoppages in July, but many seem to think the proposed changes will be dropped for some reason. Anyhow, I go to a FIFO site in August, and my employer say that LAFHA will stop as they are providing my accommodation. But I will still be paying a full rental on a house where my family will be living in my absence. So these changes may even work out better for my situation. Am I interpreting that correct Ian in your list of changes, that if I am away and my family isn't I would be elegible?

Ian Lindgren

Hi,

Unfortunately I think that anyone who is suggesting that the proposed changes will not go ahead, are really living in dreamland...honestly, no one can say at that they will not go ahead unless they have direct access to information that has not been released by the governmnet. I hate to say that, but that is the way I see it, and I really to hate to say it, because I think that the government has made a very short sighted decision.

When you go FIFO, and if the government do what they have stated they will do, then if your employer is paying for your food and accommodation, then you would not be eligible for any LAFHA. However if they are not paying for food, and you are, then you would most likely be eligible for food allowance.

Regards,

Ian