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Hi all my OH brought this info home about LAFHA so anyone on a 457 read on. Changes for Living Away from Home Allowance (LAFHA) 01-Dec-2011 The Living Away from Home Allowance (LAFHA), once a lucrative incentive for highly paid migrants to linger in the twilight zone of temporary rather than permanent residency, has been reformed in a controversial government move to prevent tax fraud. The Australian Treasurer, Wayne Swan, confirmed the changes to LAFHA on 29 November 2011. The allowance, claimed by many 457 holders, provides for cash payments to cover the costs of living away from home, interstate and overseas travel. After reports that some foreign workers were receiving up to 90 per cent of their salary tax-free, and as part of the budget-cut program, the government decided to reform LAFHA to specifically prevent overseas workers from claiming back tax. In order to continue claiming the LAFHA one must maintain a home for their own use in Australia (rather than their home come country) from which they are living away from for work. For example if a 457 holder owned a home in Sydney and their company sent them to Melbourne for work. In addition individuals claiming the allowance need to demonstrate their actual expenditure on accommodation and food beyond a statutory amount rather then simply claiming “reasonable costs” as is currently the case. Some possible effects include: - highly paid skilled overseas workers/senior executives may be deterred from working in Australia if there are better tax incentives from other countries; - more 457 workers will now be attracted to become a permanent resident as there is no more tax incentives for them to remain a temporary resident. If you are currently holding a 457 visa and claiming the LAFHA for tax reasons and wish to now apply for permanent residency contact your migration agent in order to set the ball rolling. My apologizes if I've posted under the wrong thread.