Malpaso

And what exactly is it that your supposed to provide? Is there a form available from somewhere? I understand that the food component can be obtained from the ATO website and that your rent receipts/lease agreement constitutes the accomodation component. However, how are these to be implemented by the employer at payroll time?

jayr

as you say RENT is based on ACTUAL RENT from you lease agreement.

For Food, ATO have guidelines on the "reasonable food component" based on number of people in the family, many employers would apply exactly the figure in the guidelines.

Typically (and I'm not a payroll expert) the employer will do a once off calculation to include your rent and food component then apply that on a monthly or fortnightly basis.

To be clear, I meant provide employer with everything necessary from the ATO website so that know what the rules are

Nerine

Ok, ta will do. Not paying tax on $340 each week adds up to quite a bit each month.

jayr

Just remember its not quite as straight forward as that. You WILL pay tax on $42 per adult and $21 per child. The DIFFERENCE is tax free; still very useful

stubbieholder31

Hi
ok then so we are applying now for our visa. What do we need to send to our employer in order for him to concider us for LAFHA as I have read on some threads that if we were to supply him with the relevent info it'll be no hard ship for him to set this up for us.
There seems to be a lack of knowledge on behalf of a lot of employers out there. We could certainly do with all the help we can get.
If anyone is kind enough to point me in the right direction as to how to go about this i would be so grateful!

sharonm5

hi everyone, I have LAFHA, and have been offered a novated lease for a vehicle...what does this mean?? they said I will save on tax??

Boh

I've received my LAFHA, after 2 months of battling with my employer. They refuse to back date it too
Most employers aren't aware of whats involved therefore theres a fear factor.

One question, I notice that my Superannuation is now based on my Taxable Salary (that is total salary minus LAFHA). Can anyone confirm if this is correct? Considerable employer saving if that is the case!

jayr

Yes, SUPER is calculated off the TAXABLE amount after deducting LAFHA.

For many (though not all) this a saving for the EMPLOYEE, given most employees committ 9% to their super. You may wish to top up.

jayr

do a search on this forum first then come back with any remaining questions.

Novated leases can save a lot of tax; including making you fuel, rego, incurance and maintenance costs free of income tax

Nerine

Thanks for the good advice. Not only has the employer (whom we have always held in high regard) agreed to 'pay' the food allowance but they have also said they are going to backdate it. This together with the weekly rent allowance puts a fair amount into the pay cheque every month. It seems that other people at the workplace have been claiming it and for some reason we'd slipped through the net. All sorted now though

One thing that we did discover is that after the rent element of the allowance has been deducted the employee must have a clear $45k of salary remaining, perhaps this explains why not everyone is being given the allowance?

The $45k requirement does not apply to the food allowance though, the rates are just based on the size of the family and ages of the children. Both my kids are aged 12 and over so are classed as adults for the food element because they turned 12 before the start of the tax year being claimed for.

So, as I understand it your rent is say,
$500 week / $26,000 per anum, you need to be earning 26,000 + 45,000 = $ 71,000 min to be able to claim.
$400 week = $65,800 and so on.

Big thank you to you and the other posters on this site for the really useful information.

Nerine

Here is the link for the Fringe Benefit Tax rates for the food component

2 adults and 1 or 2 kids under 12 = $370 a week
2 adults and 3 kids under 12 = $432
2 adults and 2 kids over 12 = $493

Hope people find this useful

michell

Hi all ,
i have been reading through all, well most of the posts, and am now confused totally, my hubby has been offered a job sponsorship at these figures but we dont understand what they all mean

hourly rate: $23.94
productivity:$1.10
Travelling time:$23.94
Fares:$9.20

the company will pay superannuation contributions into NESS superannuation Fund.,
now there is loads on the EBA but it is so difficult to understand, there is no mention about LAFHA , but the person who said they wanted to sponsor my husband has now forwarded on all my hubbies relevent information onto their immigration dept in the company, the company do know obviously a lot about sponsorship as they are allowed to sponsor up to 20 ppl a year and they have their own dept to deal with this , would that not be on the T & C as my husband calls it and will the immigration dept in the company know more about this than the employer,
also would anyone be able to work out if we are eligable for LAFHA or do you have to be earning a particular amount ? We are a bit worried that this job is not going to pay enough and will def not if we cant claim LAFHA on food and rental acc

We are a family of 6
2 Adults
4 children under 10

any answers or help would be really appreciated


kind regards
michell

p.s sorry about the long post and very confusing post i know

Nerine

First off if he's being sponsored for a temp visa he should go back to the employer and ask if they can give him a LAFHA.

To claim the rent element he'll need to be earning $45k plus a sum equal to the amount of rent you'll be paying every year. (see the calcs above for examples) The house you rent has to be of a comparable size/standard to the one you are leaving behind. So if you're living in a flat you may not be able to claim for the rent of a 5 bed detached with pool and tennis court.

To claim the food element you need to check out the ATO website and work out what you are entitled to. This is independent of the rent allowance so the $45k thing doesn't apply to food. It is just based on the size of the family and ages of the children.

Even if you can't claim the rent you can still claim the food. But, the employer needs to sort out both for you.

As soon as you apply for permanent residency the LAFHA will cease. If they agree to pay the LAFHA get it written into the contract before he signs.

jayr

Yes, I remember when I used to get it the amount was $35k. I think this is called the MINIMUM CASH COMPONENT and is an amount of cash income you must still have after any LAFHA or SALARY SACRIFICE arrangements.

The way it works, however, is not that you CANT claim LAFHA if it didn;t leave you with $45k; instead you would have to REDUCE the amount of LAFHA to ensure you still took $45k as cash

Nerine

Thanks for clarifying that, I was wondering if you could claim for something if it took you below $45k.