LAFHA - Budget 2012/13
May 14th 2012, 11:39 am
#196
Forum Regular
Joined: Sep 2011
Posts: 168
Re: LAFHA - Budget 2012/13
I got here last September signed up for a 12 month lease on a house last October and bought a new car on finance over 2 years in October also. If I go to the bank and tell them I can't afford the repayments anymore they won't care, how about going to the landlord and telling them the agreement I signed up to for 12 months I also cannot afford, what are the repurcussions with this? Would I even be able to get a new rental based on this? I doubt it..
I get paid $70k per year inc lafha which means I come out with $5100 per month net, from next month I will come out with $4200 this is a huge blow with very little notice.
My wife also works so we have to pay for child care which amounts to $39880 per year with no rebates since we are on a 457 visa.
We are being put in a very difficult position here, we planned our finances at least for the first 2 years so we could get on our feet here around our joint income, now we are set to lose a massive portion of this income, it will mean there is no point in me working at all. I could give up work and save $39880 instantly, the problem is my visa doesnt allow me to give up work so I am now effectively working for virtually nothing.
Anyway the gist here is they should have given us at least 12 months notice as a transition.
I get paid $70k per year inc lafha which means I come out with $5100 per month net, from next month I will come out with $4200 this is a huge blow with very little notice.
My wife also works so we have to pay for child care which amounts to $39880 per year with no rebates since we are on a 457 visa.
We are being put in a very difficult position here, we planned our finances at least for the first 2 years so we could get on our feet here around our joint income, now we are set to lose a massive portion of this income, it will mean there is no point in me working at all. I could give up work and save $39880 instantly, the problem is my visa doesnt allow me to give up work so I am now effectively working for virtually nothing.
Anyway the gist here is they should have given us at least 12 months notice as a transition.
The Aussies are criminally negligent, nothing less.
May 14th 2012, 11:50 am
#197
Social Grenade Thrower
Joined: Jan 2008
Location: South Coast, NSW
Posts: 3,625
Re: LAFHA - Budget 2012/13
I absolutely agree and feel for you. The Aus government has to be charged with criminal negligence. I wonder may be the British government may complain, make a phone call, or whatever it is they diplomatically do, because the Aussies may have contravened some term of the UK-Aus double taxation agreement(?)
The Aussies are criminally negligent, nothing less.
The Aussies are criminally negligent, nothing less.
May 14th 2012, 10:35 pm
#198
BE Forum Addict
Joined: Jul 2007
Location: Sydney
Posts: 4,404
Re: LAFHA - Budget 2012/13
Why not?? If your Visa is a Temporary one then that is EXACTLY what you are, irrespective of the duration.
Look at my situation, came over on a 3 year 457 in april 2008, then in October 2010 they applied and renewed for another 4 year 457. That would make me, if I fulfilled the term, a Temporary resident for 7 years!!!
Look at my situation, came over on a 3 year 457 in april 2008, then in October 2010 they applied and renewed for another 4 year 457. That would make me, if I fulfilled the term, a Temporary resident for 7 years!!!
May 14th 2012, 11:05 pm
#200
Forum Regular
Joined: May 2012
Posts: 47
Re: LAFHA - Budget 2012/13
No, it is pretty daft. The money won't be gone at all. It's just that you won't be getting it. ;-)
The money you undeserving 457-ers previously received as LAFHA is merely being re-distributed to worthy Australian families in the form of a nice cash handout. It's they who will be spending their windfall in coffee shops for a change - not you..
The money you undeserving 457-ers previously received as LAFHA is merely being re-distributed to worthy Australian families in the form of a nice cash handout. It's they who will be spending their windfall in coffee shops for a change - not you..
May 14th 2012, 11:07 pm
#201
Forum Regular
Joined: May 2012
Posts: 47
Re: LAFHA - Budget 2012/13
It was a tongue-in-cheek comment.
But since you ask..
Because you're just here temporarily. You're only here to fill a gap. You will be returning back to where you came from, won't you? That's why you were claiming LAFHA in the first place. You're not going to be a lucrative, long-term, tax-payer here. Your children are not going to be lucrative, long-term, tax-payers here. Your contribution to the country is going to be limited.
Therefore it's only fair that the limited dollars available go to those who will benefit the country the most. That means the citizens and the permanent residents. Those people who have made a commitment to the place.
But since you ask..
Because you're just here temporarily. You're only here to fill a gap. You will be returning back to where you came from, won't you? That's why you were claiming LAFHA in the first place. You're not going to be a lucrative, long-term, tax-payer here. Your children are not going to be lucrative, long-term, tax-payers here. Your contribution to the country is going to be limited.
Therefore it's only fair that the limited dollars available go to those who will benefit the country the most. That means the citizens and the permanent residents. Those people who have made a commitment to the place.
May 14th 2012, 11:14 pm
#202
Forum Regular
Joined: Jun 2008
Posts: 31
Re: LAFHA - Budget 2012/13
The government expect companies to make up the difference this is ridiculous. So here are 2 people doing the same job in the same situation on lets say $70k per year, 1 is Australian and 1 is a temp 457. The Australian gets 50% rebate on childcare the 457 doesnt. The 457 gets Lafha the Australian doesnt.
In my case this means
Australian: $70k paying $40k in childcare a year gets a 50% rebate so pays $20k
457 (me): $70k paying $40k childcare gets no rebate but gets Lafha amounting to $12k a year
We pay exactly the same amount of tax otherwise yet with the scrapping of lafha I will be $20k worse off than the same Australian worker doing the same at the same money. So in order for me to get the same money as the Australian the company has to pay me somewhere near $97k to cover the difference.
Not in a million years will this happen.
In my opinion this change will hit families like mine the hardest with the execs who it was meant to hit just shrugging their shoulders and moving to another part of the world. Since arriving in australia we were thinking on the possibility of applying for PR after 2 years depending on how things go, however, the way it stands we won't be here for those 2 years as we cannot afford it.
The net result here will be to discourage the families that Australia needs to migrate here from ever coming here in he first place and the families that are here to leave.
In my case this means
Australian: $70k paying $40k in childcare a year gets a 50% rebate so pays $20k
457 (me): $70k paying $40k childcare gets no rebate but gets Lafha amounting to $12k a year
We pay exactly the same amount of tax otherwise yet with the scrapping of lafha I will be $20k worse off than the same Australian worker doing the same at the same money. So in order for me to get the same money as the Australian the company has to pay me somewhere near $97k to cover the difference.
Not in a million years will this happen.
In my opinion this change will hit families like mine the hardest with the execs who it was meant to hit just shrugging their shoulders and moving to another part of the world. Since arriving in australia we were thinking on the possibility of applying for PR after 2 years depending on how things go, however, the way it stands we won't be here for those 2 years as we cannot afford it.
The net result here will be to discourage the families that Australia needs to migrate here from ever coming here in he first place and the families that are here to leave.
May 14th 2012, 11:28 pm
#203
Forum Regular
Joined: May 2012
Posts: 47
Re: LAFHA - Budget 2012/13
The government expect companies to make up the difference this is ridiculous. So here are 2 people doing the same job in the same situation on lets say $70k per year, 1 is Australian and 1 is a temp 457. The Australian gets 50% rebate on childcare the 457 doesnt. The 457 gets Lafha the Australian doesnt.
In my case this means
Australian: $70k paying $40k in childcare a year gets a 50% rebate so pays $20k
457 (me): $70k paying $40k childcare gets no rebate but gets Lafha amounting to $12k a year
We pay exactly the same amount of tax otherwise yet with the scrapping of lafha I will be $20k worse off than the same Australian worker doing the same at the same money. So in order for me to get the same money as the Australian the company has to pay me somewhere near $97k to cover the difference.
Not in a million years will this happen.
In my opinion this change will hit families like mine the hardest with the execs who it was meant to hit just shrugging their shoulders and moving to another part of the world. Since arriving in australia we were thinking on the possibility of applying for PR after 2 years depending on how things go, however, the way it stands we won't be here for those 2 years as we cannot afford it.
The net result here will be to discourage the families that Australia needs to migrate here from ever coming here in he first place and the families that are here to leave.
In my case this means
Australian: $70k paying $40k in childcare a year gets a 50% rebate so pays $20k
457 (me): $70k paying $40k childcare gets no rebate but gets Lafha amounting to $12k a year
We pay exactly the same amount of tax otherwise yet with the scrapping of lafha I will be $20k worse off than the same Australian worker doing the same at the same money. So in order for me to get the same money as the Australian the company has to pay me somewhere near $97k to cover the difference.
Not in a million years will this happen.
In my opinion this change will hit families like mine the hardest with the execs who it was meant to hit just shrugging their shoulders and moving to another part of the world. Since arriving in australia we were thinking on the possibility of applying for PR after 2 years depending on how things go, however, the way it stands we won't be here for those 2 years as we cannot afford it.
The net result here will be to discourage the families that Australia needs to migrate here from ever coming here in he first place and the families that are here to leave.
Families should receive these child care benefits as well. especially the ones coming off the LAFHA
May 14th 2012, 11:33 pm
#204
Social Grenade Thrower
Joined: Jan 2008
Location: South Coast, NSW
Posts: 3,625
Re: LAFHA - Budget 2012/13
The government expect companies to make up the difference this is ridiculous. So here are 2 people doing the same job in the same situation on lets say $70k per year, 1 is Australian and 1 is a temp 457. The Australian gets 50% rebate on childcare the 457 doesnt. The 457 gets Lafha the Australian doesnt.
In my case this means
Australian: $70k paying $40k in childcare a year gets a 50% rebate so pays $20k
457 (me): $70k paying $40k childcare gets no rebate but gets Lafha amounting to $12k a year
We pay exactly the same amount of tax otherwise yet with the scrapping of lafha I will be $20k worse off than the same Australian worker doing the same at the same money. So in order for me to get the same money as the Australian the company has to pay me somewhere near $97k to cover the difference.
Not in a million years will this happen.
In my opinion this change will hit families like mine the hardest with the execs who it was meant to hit just shrugging their shoulders and moving to another part of the world. Since arriving in australia we were thinking on the possibility of applying for PR after 2 years depending on how things go, however, the way it stands we won't be here for those 2 years as we cannot afford it.
The net result here will be to discourage the families that Australia needs to migrate here from ever coming here in he first place and the families that are here to leave.
In my case this means
Australian: $70k paying $40k in childcare a year gets a 50% rebate so pays $20k
457 (me): $70k paying $40k childcare gets no rebate but gets Lafha amounting to $12k a year
We pay exactly the same amount of tax otherwise yet with the scrapping of lafha I will be $20k worse off than the same Australian worker doing the same at the same money. So in order for me to get the same money as the Australian the company has to pay me somewhere near $97k to cover the difference.
Not in a million years will this happen.
In my opinion this change will hit families like mine the hardest with the execs who it was meant to hit just shrugging their shoulders and moving to another part of the world. Since arriving in australia we were thinking on the possibility of applying for PR after 2 years depending on how things go, however, the way it stands we won't be here for those 2 years as we cannot afford it.
The net result here will be to discourage the families that Australia needs to migrate here from ever coming here in he first place and the families that are here to leave.
May 14th 2012, 11:37 pm
#205
Lost in BE Cyberspace
Joined: Feb 2009
Location: UK
Posts: 14,284
Re: LAFHA - Budget 2012/13
The government expect companies to make up the difference this is ridiculous. So here are 2 people doing the same job in the same situation on lets say $70k per year, 1 is Australian and 1 is a temp 457. The Australian gets 50% rebate on childcare the 457 doesnt. The 457 gets Lafha the Australian doesnt.
In my case this means
Australian: $70k paying $40k in childcare a year gets a 50% rebate so pays $20k
457 (me): $70k paying $40k childcare gets no rebate but gets Lafha amounting to $12k a year
We pay exactly the same amount of tax otherwise yet with the scrapping of lafha I will be $20k worse off than the same Australian worker doing the same at the same money. So in order for me to get the same money as the Australian the company has to pay me somewhere near $97k to cover the difference.
Not in a million years will this happen.
In my opinion this change will hit families like mine the hardest with the execs who it was meant to hit just shrugging their shoulders and moving to another part of the world. Since arriving in australia we were thinking on the possibility of applying for PR after 2 years depending on how things go, however, the way it stands we won't be here for those 2 years as we cannot afford it.
The net result here will be to discourage the families that Australia needs to migrate here from ever coming here in he first place and the families that are here to leave.
In my case this means
Australian: $70k paying $40k in childcare a year gets a 50% rebate so pays $20k
457 (me): $70k paying $40k childcare gets no rebate but gets Lafha amounting to $12k a year
We pay exactly the same amount of tax otherwise yet with the scrapping of lafha I will be $20k worse off than the same Australian worker doing the same at the same money. So in order for me to get the same money as the Australian the company has to pay me somewhere near $97k to cover the difference.
Not in a million years will this happen.
In my opinion this change will hit families like mine the hardest with the execs who it was meant to hit just shrugging their shoulders and moving to another part of the world. Since arriving in australia we were thinking on the possibility of applying for PR after 2 years depending on how things go, however, the way it stands we won't be here for those 2 years as we cannot afford it.
The net result here will be to discourage the families that Australia needs to migrate here from ever coming here in he first place and the families that are here to leave.
Lets take your example again, but for two individuals without children, presumably plenty of them around too.
One gets $70k but only pays tax on half of it because they have a 457 visa (even though they are not maintaining an unlet home overseas). The other is a PR or citizen and pays tax on all $70k of it. So they are significantly worse off than the 457 holder, why is that fair?
You are a temporary worker, not a migrant. If you want to be treated as a migrant then you need to apply for a permanent visa. As a temporary worker, you (general you) need to consider the whole package, the loss of benefits (like UK child benefit say) and if it is not to your liking you don't come.
If companies find that they can no longer attract people, they will adjust the packages on offer. Perhaps they will offer to pay for or contribute to school fees or childcare fees for example. It is perfectly normal for companies to provide these benefits for expat workers even if the local workers do not get them and I have never seen it cause an issue.
It is correct that the company would be paying for these things, not the taxpayer.
May 14th 2012, 11:40 pm
#206
Lost in BE Cyberspace
Joined: Feb 2009
Location: UK
Posts: 14,284
Re: LAFHA - Budget 2012/13
That my friend is EXACTLY what those pontificating over its loss do NOT understand. They are not seeing the forest for the trees and singularly fail to understand the impact of this on Temporary workers who are not highly paid Execs...apart from saying 'if you don't like it go home'.
And there is nothing wrong with saying if they don't like it go home.
Temporary workers are temporary and should always be ready to go home with 28 days notice. Seems to me some want to have it both ways, get tax breaks because they are apparently temporary, yet expect to stay permanently or for as long as they want.
May 14th 2012, 11:43 pm
#207
Social Grenade Thrower
Joined: Jan 2008
Location: South Coast, NSW
Posts: 3,625
Re: LAFHA - Budget 2012/13
Yes, but the point of the LAFHA is for temporary residents to maintain a life back home while they decide on where to live. Obviously, that shouldn't take 7 years. I'm not saying that a 457 visa shouldn't exist after 2 years. But an incentive to move to permanent would be to lose the LAFHA after that amount of time, forcing people into deciding sooner, rather than later. It's one of the easier countries to get a permanent visa.
LAFHA is not there while you 'decide' on where you live. Its to compensate whilst you are here temporarily and still have a home in your country of permanence. You can take as long as you like on a Temporary assignment, why are you limiting it?
Try and understand, a 457 Visa is not a 'try before you buy' option. Yes, it may be for some and thats how they may see it, but its purpose is to fill a skill gap for temporary purposes. The 457 Visa is not, at the moment, really part of the discusssion but some effects of it are such as no entitlements to those tax breaks/offsets/etc which other full tax paying residents get.
Don't forget, a 457 resident is a full tax paying resident as well but has to pay for public schooling in NSW and also full child care fees with no rebates, un like permanent residents or citizens.
I agree that LAFHA has been poorly implemented, I agree it needs to be seriously reviewed and managed, I agree that some have used it as a cash cow. What I do not agree with is the assumption that as a temporary resident you are treated as a full tax payer along with others but do not have the same opportunities for parity. It is not a level playing field, simple as that and irrespective of salary and company obligations, the Australian government is taking the piss.
But, like some have pointed out, 457 visa holders are in a minority and have no voting rights at all so whty should the government care.
May 14th 2012, 11:46 pm
#208
Social Grenade Thrower
Joined: Jan 2008
Location: South Coast, NSW
Posts: 3,625
Re: LAFHA - Budget 2012/13
Why do you insist that we do not understand? I understand perfectly and disagree thoroughly.
And there is nothing wrong with saying if they don't like it go home.
Temporary workers are temporary and should always be ready to go home with 28 days notice. Seems to me some want to have it both ways, get tax breaks because they are apparently temporary, yet expect to stay permanently or for as long as they want.
And there is nothing wrong with saying if they don't like it go home.
Temporary workers are temporary and should always be ready to go home with 28 days notice. Seems to me some want to have it both ways, get tax breaks because they are apparently temporary, yet expect to stay permanently or for as long as they want.
May 14th 2012, 11:51 pm
#209
BE Forum Addict
Joined: Jul 2007
Location: Sydney
Posts: 4,404
Re: LAFHA - Budget 2012/13
No. You are wrong.
LAFHA is not there while you 'decide' on where you live. Its to compensate whilst you are here temporarily and still have a home in your country of permanence. You can take as long as you like on a Temporary assignment, why are you limiting it?
Try and understand, a 457 Visa is not a 'try before you buy' option. Yes, it may be for some and thats how they may see it, but its purpose is to fill a skill gap for temporary purposes. The 457 Visa is not, at the moment, really part of the discusssion but some effects of it are such as no entitlements to those tax breaks/offsets/etc which other full tax paying residents get.
Don't forget, a 457 resident is a full tax paying resident as well but has to pay for public schooling in NSW and also full child care fees with no rebates, un like permanent residents or citizens.
I agree that LAFHA has been poorly implemented, I agree it needs to be seriously reviewed and managed, I agree that some have used it as a cash cow. What I do not agree with is the assumption that as a temporary resident you are treated as a full tax payer along with others but do not have the same opportunities for parity. It is not a level playing field, simple as that and irrespective of salary and company obligations, the Australian government is taking the piss.
But, like some have pointed out, 457 visa holders are in a minority and have no voting rights at all so whty should the government care.
LAFHA is not there while you 'decide' on where you live. Its to compensate whilst you are here temporarily and still have a home in your country of permanence. You can take as long as you like on a Temporary assignment, why are you limiting it?
Try and understand, a 457 Visa is not a 'try before you buy' option. Yes, it may be for some and thats how they may see it, but its purpose is to fill a skill gap for temporary purposes. The 457 Visa is not, at the moment, really part of the discusssion but some effects of it are such as no entitlements to those tax breaks/offsets/etc which other full tax paying residents get.
Don't forget, a 457 resident is a full tax paying resident as well but has to pay for public schooling in NSW and also full child care fees with no rebates, un like permanent residents or citizens.
I agree that LAFHA has been poorly implemented, I agree it needs to be seriously reviewed and managed, I agree that some have used it as a cash cow. What I do not agree with is the assumption that as a temporary resident you are treated as a full tax payer along with others but do not have the same opportunities for parity. It is not a level playing field, simple as that and irrespective of salary and company obligations, the Australian government is taking the piss.
But, like some have pointed out, 457 visa holders are in a minority and have no voting rights at all so whty should the government care.
Also, permanent resident visa holders cannot vote either.
May 14th 2012, 11:54 pm
#210
Social Grenade Thrower
Joined: Jan 2008
Location: South Coast, NSW
Posts: 3,625
Re: LAFHA - Budget 2012/13
Why do people have to decide where their home is long term? Haven't they already done that by keeping a home in UK whilst they are temporarily in Oz? Thats the decision already made isn't it?
As for switching to PR, some do not have that choice especially in the early years of a 457.