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Proposed ATO changes to LAFHA

November 29, 2011

The Australian Government has today released their Mid-Year Economic and Fiscal Outlook (MYEFO 2011-12). At this time, two key points have been flagged as potential changes.

The Australian Government has today released their Mid-Year Economic and Fiscal Outlook (MYEFO 2011-12). At this time, two key points have been flagged as potential changes.

1. Requiring individuals to substantiate their actual expenditure on accommodation, and substantiate food beyond a statutory amount;
   
   OnCore Response -This change is actually consistent with our current methodology of determining the applicable LAFHA amount and therefore, it will be business as usual for our clients in this regard.


2. Limiting access to the tax concession for temporary residents to those who maintain a home for their own use in Australia that they are living away from, for the purpose of work.
   
   OnCore Response -This second change is relevant to temporary residents and concerns their eligibility to receive the allowance. Final details are to be communicated further by the Government. At this point the allowance in its current form is valid until the 30^st June 2012.*

*Subject to change based on updated information from the Australian Government.

Next steps:

1. A consultation process will now occur with any subsequent changes confirmed as they come to light. Further details of any proposed changes will most likely be available after February/March 2012.
2. Legislation has to be approved by parliament before any changes are implemented.
3. OnCore will be actively involved in the consultation process prior to February 2012.
4. OnCore will communicate any changes, updates or further details as and when they come to light.