bryam99 Posted January 20, 2008 Share Posted January 20, 2008 Hi there poms in oz, we got our 457 visas and we fly out on the 14th feb (Brisbane). I am trying to work out this LAFHA tax break, is it someting we can claim back at the end of the financial year or do you pay tax at a lower rate through the year? Also did someone mention that you can get car finance on a 457? This would ease matters enormously for us as we are only going over with around $5000 in our pockets after our first months expenses are paid for. I am starting work 2 days after landing to start to bring money in but the thought of having to blow most of our dosh on a car straight off is scary! Where do you go to find these things out? Any advice is greatly appreciated! Still very exciting tho! Link to comment Share on other sites More sharing options...
Guest EM&M Posted January 21, 2008 Share Posted January 21, 2008 Here Goes....... This is how I have it in Plain English LAFHA = Living Away from home allowance You CAN NOT have LAFHA if you buy a house or apply for PR. You DO NOT need to have another home (say a house in the UK) to be able to get LAFHA. You CAN HAVE LAFHA for the entire duration of your TEMPORARY VISA. LAFHA is recognised by the ATO but is NOT a right, it must be offered (and administered) by the employer. You should ask your prospective employer for it in advance, and preferably have it stated in the contract. There are two elements to LAFHA: 1) House Rental. Your rent for accommodation is covered out of BEFORE TAX income and there is no other tax (such as Fringe Benefits Tax to pay). Example: Annual income $70,000 (before Super); Annual Rent $20,000 Your rent is TAX FREE. NET MONTHLY INCOME without LAFHA = $4383 NET MONTHLY INCOME WITH LAFHA = $4908 So $6000 a year better off in this example. You tell your employer how much your rent (give them rental agreement) is and they adjust your NET pay accordingly. 2) Food allowance. There is a food allowance which is a FIXED amount that depends on the number of people in your family. Your ACTUAL food costs are irrelevant. Allowance is $42 per adult per week and $21 per child per week. This (I'm fairly sure) is income tax free and FBT free; that is it is not taxed. Using same income info from above and assuming just two adults, the EXTRA income is (42*2adults*52 weeks) or $4368 year or $364/month. So with LAFHA take home pay is now $4908+364= $5272/month. Compared to WITHOUT LAFHA income of $4383 then you would be $889 NET a month better off. Put it another way, your $70,000 annual salary WITH LAFHA provides a net monthly income equivalent to an annual salary of $87,500 WITHOUT LAFHA Link to comment Share on other sites More sharing options...
bryam99 Posted January 21, 2008 Author Share Posted January 21, 2008 Thankyou so much EM+M thats really helpful. I dont know what id do without poms in oz! :v_SPIN: Link to comment Share on other sites More sharing options...
Guest billy braveheart Posted January 21, 2008 Share Posted January 21, 2008 Hi bryam99, Yes you can get car finance on a 457 BUT they insist on a minimum $1000 deposit and the remainder of the finance is taken out over the time of the visa to ensure that IF you dont get pr then the loan will be paid off before the 457 expires,Good luck to you starting work so soon after arriving you will be shattered my friend at least i had the benefit of having 3 weeks off before starting hope this helps billy Link to comment Share on other sites More sharing options...
bryam99 Posted January 21, 2008 Author Share Posted January 21, 2008 Ah thanks Billy Braveheart! Such a load off my mind! I know i would rather have some time to recooperate after the long journey and get to know Brissy but with two kids and a house rental,car etc etc etc theres a bit of pressure. But theres always the weekends!!! Looking forward to the change, the challenge and even the hard work if it means we can mooch about in the sun discovering a little bit of Oz each weekend! x x Link to comment Share on other sites More sharing options...
Guest Helaine Posted January 21, 2008 Share Posted January 21, 2008 LAFHA = how and where can we find info on this, as i have never come across it before, also some info about the food allowance if poss, we are heading over in May/june and i would like to be clued up b4 we get there and b4 hubbie signs his contract. Thanks hun Link to comment Share on other sites More sharing options...
Guest leanneandmark Posted January 21, 2008 Share Posted January 21, 2008 Is this just on 457 visa? and in Qld? or does it apply to all temp visas in all states?? Link to comment Share on other sites More sharing options...
Guest Liam Posted January 21, 2008 Share Posted January 21, 2008 LAFHA = how and where can we find info on this, as i have never come across it before, also some info about the food allowance if poss, we are heading over in May/june and i would like to be clued up b4 we get there and b4 hubbie signs his contract. Thanks hun Have a look at these info sites: The Living Away From Home Allowance explained - Brainbox.com.au http://www.gomatilda.com/news/documents/The_Living_Away...m_Home_Allowance.pdf regards Liam Link to comment Share on other sites More sharing options...
bryam99 Posted January 22, 2008 Author Share Posted January 22, 2008 Mmmmmm.... I cant see LAFHA (living away from home allowance) info anywhere on the Australian Tax Office website, and my employer has never heard of it despite sponsoring six overseas employees on 457visas and more people in previous years. I think it may depend on the employer. The only time I have seen anything about it is when it applied to university students leaving home to study, and that was on the QLD education authority site somewhere. I cant find anything official on this tax allowance. Link to comment Share on other sites More sharing options...
Guest pvav Posted March 12, 2008 Share Posted March 12, 2008 Here Goes....... This is how I have it in Plain English LAFHA = Living Away from home allowance You CAN NOT have LAFHA if you buy a house or apply for PR. You DO NOT need to have another home (say a house in the UK) to be able to get LAFHA. You CAN HAVE LAFHA for the entire duration of your TEMPORARY VISA. LAFHA is recognised by the ATO but is NOT a right, it must be offered (and administered) by the employer. You should ask your prospective employer for it in advance, and preferably have it stated in the contract. There are two elements to LAFHA: 1) House Rental. Your rent for accommodation is covered out of BEFORE TAX income and there is no other tax (such as Fringe Benefits Tax to pay). Example: Annual income $70,000 (before Super); Annual Rent $20,000 Your rent is TAX FREE. NET MONTHLY INCOME without LAFHA = $4383 NET MONTHLY INCOME WITH LAFHA = $4908 So $6000 a year better off in this example. You tell your employer how much your rent (give them rental agreement) is and they adjust your NET pay accordingly. 2) Food allowance. There is a food allowance which is a FIXED amount that depends on the number of people in your family. Your ACTUAL food costs are irrelevant. Allowance is $42 per adult per week and $21 per child per week. This (I'm fairly sure) is income tax free and FBT free; that is it is not taxed. Using same income info from above and assuming just two adults, the EXTRA income is (42*2adults*52 weeks) or $4368 year or $364/month. So with LAFHA take home pay is now $4908+364= $5272/month. Compared to WITHOUT LAFHA income of $4383 then you would be $889 NET a month better off. Put it another way, your $70,000 annual salary WITH LAFHA provides a net monthly income equivalent to an annual salary of $87,500 WITHOUT LAFHA Hi, I found this example of LAHFA wery useful. Would you mind telling me where can I get info about the calculation method? I would like to be able to work out what would my net montly salary be with LAHFA. I also know that there is some king of limit to the rent component, which changes year to year. I assume the info is to be found somwher in tax legislation / ATO rulings. All I was able to find so far is FBT act which doesn't state any numbers or celculation formulas. Thank you wery much for answer. PVAV Link to comment Share on other sites More sharing options...
Guest billy braveheart Posted March 12, 2008 Share Posted March 12, 2008 Hi, I found this example of LAHFA wery useful. Would you mind telling me where can I get info about the calculation method? I would like to be able to work out what would my net montly salary be with LAHFA. I also know that there is some king of limit to the rent component, which changes year to year. I assume the info is to be found somwher in tax legislation / ATO rulings. All I was able to find so far is FBT act which doesn't state any numbers or celculation formulas. Thank you wery much for answer. PVAV You cant claim LAFHA it is an agreement you have with your employer in your 457 contract i believe so in other words if its not in your contract you dont get it billy Link to comment Share on other sites More sharing options...
Guest kate b Posted March 15, 2008 Share Posted March 15, 2008 hi im not sure if its the same thing but my empoyers are offering me a 'salary sacrifice' for my rental costs which are going to be put in writing if i want to except, if it isnt i will definetley be looking into LAFHA they told me most organisations now offer it . kate Link to comment Share on other sites More sharing options...
Guest igraham Posted April 3, 2008 Share Posted April 3, 2008 Can anyone help I have been in Oz for 9 months and am currently claiming LAFHA. I am on a 457 visa and would like to know how my employer should be paying the tax free contribution to me. At present they are removing the LAHFA component off of my salary prior to me paying tax. This means that when I get a wage slip it shows up at a lower yearly rate of pay than I am contracted on. If I work any overtime it is payed to me at the lower rate, which I think is incorrect. Also my employer is paying my Super at the lower rate rather than my contracted rate which means I am currently getting $195.00 per month less than I should be. Does anyone know how the LAFHA system works, as ther is limited information on this. Ian Link to comment Share on other sites More sharing options...
Guest JoanneHattersley Posted April 3, 2008 Share Posted April 3, 2008 When we arrived, we landed on the wednesday. I was at the agency oh the thursday signing papers and at work on Friday! I got jet lag about three months later! Its knackering but trust me..........work thru the pain!!!!!!!!!!!!! Link to comment Share on other sites More sharing options...
Guest BullcreekBob Posted April 5, 2008 Share Posted April 5, 2008 At present they are removing the LAHFA component off of my salary prior to me paying tax. This means that when I get a wage slip it shows up at a lower yearly rate of pay than I am contracted on. /quote] This is EXACTLY correct. With LAFHA you have entered an agreement with your employer that they will reduce you wages by $xyz and in return they will pay you $xyz of expenses. What is the problem? If they paid you the $xyz as part of your salary you would have to pay tax on it and it might also put you into a higher tax bracket. Link to comment Share on other sites More sharing options...
half a dozen Posted February 25, 2009 Share Posted February 25, 2009 Hi Can anyone help? We have been here (Perth) since November 08 and hubby has worked for the local council since 1 Dec, he was sponsored in by them on the 457 visa. We've met other POMS since arriving and they all seem to be claiming LAFHA (Living and working away from home allowance). He has asked the HR department about it and they haven't a clue what h or any other he's on about. As we are here on the 457 and therefore cannot claim family credit or any other benefit, can we claim the LAFHA as the people who are think we should be, they said it was so easy, just sign a form from the Employer and away you go. Any info would be much appreciated, thanks. :confused::notworthy: Link to comment Share on other sites More sharing options...
Mongrel Posted February 25, 2009 Share Posted February 25, 2009 Hi Can anyone help? We have been here (Perth) since November 08 and hubby has worked for the local council since 1 Dec, he was sponsored in by them on the 457 visa. We've met other POMS since arriving and they all seem to be claiming LAFHA (Living and working away from home allowance). He has asked the HR department about it and they haven't a clue what h or any other he's on about. As we are here on the 457 and therefore cannot claim family credit or any other benefit, can we claim the LAFHA as the people who are think we should be, they said it was so easy, just sign a form from the Employer and away you go. Any info would be much appreciated, thanks. :confused::notworthy: You do not claim it as the other posts have said your employer has to offer it to you. It is not money on top of your salary . Its tax break simply if you earn $50000 a year you pay tax on $50000. With Lafha your salary is $45000 with the company paying $5000 expenses so you save the tax on $5000. In anutshell expenses are taken out of your salary before tax so you save the tax on the expenses Mally Link to comment Share on other sites More sharing options...
Guest crabbejo Posted February 26, 2009 Share Posted February 26, 2009 So if I use the above example of salary of $70k. My OH will be earning $50k, if our rent is $500/week does that mean she will only pay tax on $24k? Plus we would get an extra $123/week food allowance (2 adults + 2 kids)? Seems VERY generous if thats the case Link to comment Share on other sites More sharing options...
Mongrel Posted February 26, 2009 Share Posted February 26, 2009 So if I use the above example of salary of $70k. My OH will be earning $50k, if our rent is $500/week does that mean she will only pay tax on $24k? Plus we would get an extra $123/week food allowance (2 adults + 2 kids)? Seems VERY generous if thats the case All it is the lafha is a tax break you get living expenses before tax not after tax . $70000 salary, tax for example $10000 ( theoretically) with lafha $65000 and lafha expenses paid $5000 tax $8000 so you save $2000 of tax .these are just figures i used to illustrate this , a lot think lafha is on top of there salary but when you go in for pr go for a pay rise Mally Link to comment Share on other sites More sharing options...
Guest crabbejo Posted February 26, 2009 Share Posted February 26, 2009 All it is the lafha is a tax break you get living expenses before tax not after tax . $70000 salary, tax for example $10000 ( theoretically) with lafha $65000 and lafha expenses paid $5000 tax $8000 so you save $2000 of tax .these are just figures i used to illustrate this , a lot think lafha is on top of there salary but when you go in for pr go for a pay rise Mally cheers Mally, bit confusing when you're not used to it, but I guess it's a tax break which will help us when getting started:cool: until we get to apply for PR Link to comment Share on other sites More sharing options...
Mongrel Posted February 26, 2009 Share Posted February 26, 2009 cheers Mally, bit confusing when you're not used to it, but I guess it's a tax break which will help us when getting started:cool: until we get to apply for PR Theres also salary sacrificing oh a nurse does a lot of employers do it , there are companies who do this and charge you a small amount , you sacrifice part of your salary for mortgage ,rent ,car even dining out ,but you have to show rental ,mortgage cotracts ,car loans etc , think it s 9 grand a year goes out of your salary before tax then the salarey sac firm pays it into your bank the next day Maly Link to comment Share on other sites More sharing options...
Guest charlinoz Posted July 15, 2009 Share Posted July 15, 2009 Hey, I worked in Australia for a while on my working holiday visa, I got LAFHA through working through a company called Geoffrey Nathan... my timesheets went to them and they paid me with the living away from home allowance.. they helped me get my residency too ! google them! Link to comment Share on other sites More sharing options...
Guest charlinoz Posted July 15, 2009 Share Posted July 15, 2009 Hey! just saw this - i replied on another thread...but Geoffrey Nathan is one of the companies that does that. they helped me get my residency too!... I rate them! Link to comment Share on other sites More sharing options...
Guest Rocky2 Posted December 15, 2009 Share Posted December 15, 2009 Hi, Should have been a member of Poms in Oz some time ago...but hey! I have have just heard of this LAFHA allowance and have not been claiming the benefit for 1 year( time spent in Brisbane thus far). Obviously deeply concerned with my lack of basic information. Does an employer have to pay this benefit if you are eligible? If so, are you aware if it can it be back dated? Thank you in advance for your reply. Regards, Rocky2 Link to comment Share on other sites More sharing options...
Guest ezeepz Posted December 15, 2009 Share Posted December 15, 2009 Hi bryam99 I'm not saying anyone here is misleading because I had never heard of it other than for existing employees going to a worksite remote to their normal Aus home. In this case it would form part of their collective agreement. I am surprised the ATO give away money to foreign nationals to work here. Do you intend to go back to the UK as that maybe the key in proving or not that you ar entitled to LAFHA. But as I say I had never heard of it. Here are some links to other places I have just found. They may help. Happy reading. Living Away From Home Allowance (LAFHA) - update The lowdown on LAFHA - Brainbox.com.au Good explanation here as well Living Away From Home Allowance LAFHA Cheers Link to comment Share on other sites More sharing options...
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