Living Away From Home Allowance (merged threads)
Oct 20th 2010 | 9:38 pm
#61
Forum Regular
Joined: Sep 2010
Posts: 60
Re: Living Away From Home Allowance (merged threads)
How do you figure that out???
The company pays your salary, the LAFHA aspect is managed by them but is a tax incentive by the ATO for those who have a Permanent residence somewhere else and only intend to stay here temporarily. The salary is the same to the company irrespective of your LAFHA, if anything, with FBT aspects it may work out slightly more expensive for them.
To simplyfy, your salary gets calculated, 9% Super taken off, LAFHA element taken off plus Novated Lease, then you get taxed, then LAFHA and Novated Lease put back on and you are paid.
Here is a basic spreadsheet of the figures you can expect. Just amend the figures to suit your circumstance and LAFHA amounts.
Remember, the food amount is set by ATO depending on family size (if I remember correctly its $371 per week for a 2 ad 1 ch family for Food). The rental amount varies and is agreed between you and your company. Generally for a 2 adult 1 child family I would use $500 per week as a rental example.
The company pays your salary, the LAFHA aspect is managed by them but is a tax incentive by the ATO for those who have a Permanent residence somewhere else and only intend to stay here temporarily. The salary is the same to the company irrespective of your LAFHA, if anything, with FBT aspects it may work out slightly more expensive for them.
To simplyfy, your salary gets calculated, 9% Super taken off, LAFHA element taken off plus Novated Lease, then you get taxed, then LAFHA and Novated Lease put back on and you are paid.
Here is a basic spreadsheet of the figures you can expect. Just amend the figures to suit your circumstance and LAFHA amounts.
Remember, the food amount is set by ATO depending on family size (if I remember correctly its $371 per week for a 2 ad 1 ch family for Food). The rental amount varies and is agreed between you and your company. Generally for a 2 adult 1 child family I would use $500 per week as a rental example.
This post is really good but is there a latest calculator availablke like this with or without novated lease, lafha etc, much appreciated. Also how close do you find the calculator is in regard to actual taxes? Cheers
Oct 20th 2010 | 10:32 pm
#62
BE Enthusiast
Joined: Feb 2009
Posts: 421
From: Windy place
Re: Living Away From Home Allowance (merged threads)
My wife has been called about a job for $80,000. However it's a government job, within a payscale and they would not be able to deviate from that salary for that role. I was hoping we could claim LAFHA.
However, if for example we claimed LAFHA at $20,000 would that then mean she was in effect being paid a salary of $60,000 which would be below the going rate and not acceptable by the department of immigration?
However, if for example we claimed LAFHA at $20,000 would that then mean she was in effect being paid a salary of $60,000 which would be below the going rate and not acceptable by the department of immigration?
Oct 20th 2010 | 10:37 pm
#63
Lost in BE Cyberspace
Joined: Feb 2009
Posts: 14,284
From: UK
Re: Living Away From Home Allowance (merged threads)
My wife has been called about a job for $80,000. However it's a government job, within a payscale and they would not be able to deviate from that salary for that role. I was hoping we could claim LAFHA.
However, if for example we claimed LAFHA at $20,000 would that then mean she was in effect being paid a salary of $60,000 which would be below the going rate and not acceptable by the department of immigration?
However, if for example we claimed LAFHA at $20,000 would that then mean she was in effect being paid a salary of $60,000 which would be below the going rate and not acceptable by the department of immigration?
Oct 20th 2010 | 11:52 pm
#65
Guest
Posts: n/a
Re: Living Away From Home Allowance (merged threads)
3. Temporary Business (Long Stay) - subclass 457 Visa
Staff members entering Australia on a Temporary business (long stay) - subclass 457 visa are required at all times to meet and exceed the Temporary Skilled Migration Threshold (TSMIT) which may affect their ability to salary package LAFHA.
The University may be in breach of its obligations under the subclass 457 visa if the TSMIT is not met.
For subclass 457 visa holders, the salary must not include:
• accommodation or rental assistance, board, upkeep, meals or entertainment;
• incentives, bonuses or commissions;
• shares or bonus shares;
• travel, holidays, health care/insurance;
• vehicles or vehicle allowances;
http://www.usyd.edu.au/hr/policydev/...guidelines.pdf
and
No allowances (such as Living Away From Home Allowance) or bonuses can be included in the MSL.
http://www.immi.gov.au/skilled/skill...ary-levels.htm
Staff members entering Australia on a Temporary business (long stay) - subclass 457 visa are required at all times to meet and exceed the Temporary Skilled Migration Threshold (TSMIT) which may affect their ability to salary package LAFHA.
The University may be in breach of its obligations under the subclass 457 visa if the TSMIT is not met.
For subclass 457 visa holders, the salary must not include:
• accommodation or rental assistance, board, upkeep, meals or entertainment;
• incentives, bonuses or commissions;
• shares or bonus shares;
• travel, holidays, health care/insurance;
• vehicles or vehicle allowances;
http://www.usyd.edu.au/hr/policydev/...guidelines.pdf
and
No allowances (such as Living Away From Home Allowance) or bonuses can be included in the MSL.
http://www.immi.gov.au/skilled/skill...ary-levels.htm
Oct 21st 2010 | 12:24 am
#66
BE Enthusiast
Joined: Feb 2009
Posts: 421
From: Windy place
Re: Living Away From Home Allowance (merged threads)
Not so great then 
Oct 21st 2010 | 12:40 am
#67
Forum Regular
Joined: Sep 2010
Posts: 60
Re: Living Away From Home Allowance (merged threads)
$144,000 Gross Annual Income = $8,384 monthly net
$ 99,000 Gross Annual Income = $6,078 monthly net
$99,000 salary + $45,000 in non taxable allowances (LAFHA) = $9,827 monthly net
But then, if the $144,000 includes super, it becomes:
$132,000 Gross Annual Income = $7,769 monthly net
$ 87,000 Gross Annual Income = $5,463 monthly net
$87,000 salary + $45,000 in non taxable allowances (LAFHA) = $9,213 monthly net
$ 99,000 Gross Annual Income = $6,078 monthly net
$99,000 salary + $45,000 in non taxable allowances (LAFHA) = $9,827 monthly net
But then, if the $144,000 includes super, it becomes:
$132,000 Gross Annual Income = $7,769 monthly net
$ 87,000 Gross Annual Income = $5,463 monthly net
$87,000 salary + $45,000 in non taxable allowances (LAFHA) = $9,213 monthly net
Does it make any big difference if I go for novated lease and salary packaging kids schooling costs?
I am looking for a good calculator which has all components like LAFHA, novated lease, and anything else beneficial in tax saveing.
cheers
Oct 21st 2010 | 6:22 pm
#68
Guest
Posts: n/a
Re: Living Away From Home Allowance (merged threads)
I think you may need "qualified" advice on the subject.
Oct 22nd 2010 | 9:13 am
#70
Social Grenade Thrower
Joined: Jan 2008
Posts: 3,625
From: South Coast, NSW
Re: Living Away From Home Allowance (merged threads)
Oct 22nd 2010 | 11:51 am
#71
Guest
Posts: n/a
Re: Living Away From Home Allowance (merged threads)
They need to check what MSL they are on, and only claim sufficient LAFHA to stay over the MSL.
Oct 22nd 2010 | 8:38 pm
#72
Social Grenade Thrower
Joined: Jan 2008
Posts: 3,625
From: South Coast, NSW
Re: Living Away From Home Allowance (merged threads)
Also, bearing in mind the salary is 80k, they must be cognisant of what MSL they have to meet.
Dec 28th 2010 | 11:07 pm
#73
Just Joined
Joined: Dec 2010
Posts: 7
Re: Living Away From Home Allowance (merged threads)
Quick question about LAFHA guys.
Recently I've been doing some overtime and have a question about the overtime rate I've been paid.
Example:
Salary 100,000
LAFHA 40,000
Overtime Hourly Rate: 60,000 /26*67.5 = $34
Basically, they are calculating my hourly overtime rate from my salary minus LAFHA.
Is this correct? I would assume my hourly rate would come from my base salary and LAFHA should not even come into it.
Overtime Hourly Rate: 100000/26*67.5 = $57
Recently I've been doing some overtime and have a question about the overtime rate I've been paid.
Example:
Salary 100,000
LAFHA 40,000
Overtime Hourly Rate: 60,000 /26*67.5 = $34
Basically, they are calculating my hourly overtime rate from my salary minus LAFHA.
Is this correct? I would assume my hourly rate would come from my base salary and LAFHA should not even come into it.
Overtime Hourly Rate: 100000/26*67.5 = $57
Dec 29th 2010 | 12:29 am
#74
Lost in BE Cyberspace
Joined: Dec 2010
Posts: 14,040
Re: Living Away From Home Allowance (merged threads)
LAFHA is a tax benefit to you and any calculations based on your salary of any type should not include the LAFHA tax benefit ....... Remember LAHFA is a tax benefit. ie you pay less tax to compensate for living away from home.
