Commonwealth legislation

PAYG Withholding Variation: Labour Hire reimbursements and allowances

In ForceCTH

Jurisdiction

Commonwealth

Collection

legislative instrument

Plain English Summary

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This instrument directs that pay-as-you-go (PAYG) withholding is nil for certain labour‑hire reimbursements and specified allowances where conditions are met. It applies to reimbursements of actual work‑related expenses and to cents‑per‑kilometre (up to 5,000 km) or overnight travel allowances, provided the worker could claim an equal tax deduction, can substantiate the claim, and the payer records the amount and nature separately. Payers must stop withholding where these conditions are satisfied.

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PAYG Withholding Variation: Labour Hire reimbursements and allowances

Legislative Instrument

PAYG Withholding Variation: Labour Hire reimbursements and allowances

I, Matthew Bambrick, Acting Deputy Commissioner of Taxation, make this variation under section 15-15 of Schedule 1 to the Taxation Administration Act 1953.

Acting Deputy Commissioner of Taxation

Dated: 13 September 2016

Name of instrument

This instrument is the PAYG Withholding Variation: Labour Hire reimbursements and allowances.

2. Commencement
This instrument commences on the day after its registration on the Federal Register of Legislative Instruments.

3. Repealing of existing instrument
This instrument repeals and replaces legislative instrument PAYG Withholding Variation: Labour hire reimbursements and allowances (F2016L00436), registered on 30 March 2016.

4. Application
This instrument applies to payments that are covered by section 12-60 in Schedule 1 to the Taxation Administration Act 1953 within the class of cases described below.

5. Class of cases

A payment for reimbursement of actual expenses incurred by the labour hire worker, provided:

 the expense that the labour hire worker incurs is related directly to the labour hire worker’s work or services performed under the labour hire arrangement
 the expenses that the labour hire worker incurred may be able to be claimed as a tax deduction at least equal to the amount of the reimbursement
 the labour hire worker is able to substantiate the tax deduction claimed, and
 the amount and nature of the reimbursement is shown separately in the accounting records of the payer.

An allowance payment being:

 Cents per kilometre car expense payments calculated using the approved cents per kilometre rate (to a maximum of 5,000 business kilometres), or
 Domestic or overseas travel expenses involving an overnight absence from the labour hire worker’s ordinary place of residence.

Provided that:

 the labour hire worker is expected to incur expenses that may be able to be claimed as a tax deduction at least equal to the amount of the allowance,
 the labour hire worker is able to substantiate the tax deduction claimed, and
 the amount and nature of the allowance is shown separately in the accounting records of the payer.

6. Amount to be withheld
The amount to be withheld from payments covered by this instrument has been varied to nil.

Source text

Sourced from the Federal Register of Legislation (legislation.gov.au), CC BY 4.0.

1 PAYG Withholding Variation: Labour Hire reimbursements and allowances

Legislative Instrument

PAYG Withholding Variation: Labour Hire reimbursements and allowances

I, Matthew Bambrick, Acting Deputy Commissioner of Taxation, make this variation under section 15-15 of Schedule 1 to the Taxation Administration Act 1953.

Acting Deputy Commissioner of Taxation

Dated: 13 September 2016

Name of instrument

This instrument is the PAYG Withholding Variation: Labour Hire reimbursements and allowances.

2. Commencement
This instrument commences on the day after its registration on the Federal Register of Legislative Instruments.

3. Repealing of existing instrument
This instrument repeals and replaces legislative instrument PAYG Withholding Variation: Labour hire reimbursements and allowances (F2016L00436), registered on 30 March 2016.

4. Application
This instrument applies to payments that are covered by section 12-60 in Schedule 1 to the Taxation Administration Act 1953 within the class of cases described below.

5. Class of cases

A payment for reimbursement of actual expenses incurred by the labour hire worker, provided:

 the expense that the labour hire worker incurs is related directly to the labour hire worker’s work or services performed under the labour hire arrangement
 the expenses that the labour hire worker incurred may be able to be claimed as a tax deduction at least equal to the amount of the reimbursement
 the labour hire worker is able to substantiate the tax deduction claimed, and
 the amount and nature of the reimbursement is shown separately in the accounting records of the payer.

An allowance payment being:

 Cents per kilometre car expense payments calculated using the approved cents per kilometre rate (to a maximum of 5,000 business kilometres), or
 Domestic or overseas travel expenses involving an overnight absence from the labour hire worker’s ordinary place of residence.

Provided that:

 the labour hire worker is expected to incur expenses that may be able to be claimed as a tax deduction at least equal to the amount of the allowance,
 the labour hire worker is able to substantiate the tax deduction claimed, and
 the amount and nature of the allowance is shown separately in the accounting records of the payer.

6. Amount to be withheld
The amount to be withheld from payments covered by this instrument has been varied to nil.