T4 Zone or overseas forces 2015

Are you entitled to claim for living in a zone or serving in an overseas force?

You may be able to claim this tax offset if you:

• lived or worked in a remote or isolated area of Australia, not including an offshore oil or gas rig, or
• served overseas as a member of the Australian Defence Force or a United Nations armed force.

No	Go to question T5 Total net medical expenses, or return to main menu Individual tax return instructions.
Yes	Read on.

Zone tax offset

Remote areas are classed as either zone A or zone B. There are also special areas within these zones. If you do not know which zone your area is in, see tables 8, 9 and 10.

To qualify for the tax offset, you must have lived or worked in a remote area (not necessarily continuously) for:

• 183 days or more during 2014–15, or
• 183 days or more during the period 1 July 2013 to 30 June 2015 (including at least one day in 2014–15) and you did not claim a zone tax offset in your 2014 tax return.

If you lived in a zone for less than 183 days in 2014–15, you may still be able to claim a tax offset as long as you lived in a zone for a continuous period of less than five years after 1 July 2009 and:

• you were unable to claim in the first year because you were there less than 183 days, and
• the total of the days you were there in the first year and in 2014–15 is 183 or more. The period you were in a zone in 2014-15 must include the first day of the income year.

Overseas forces tax offset

You may be eligible for an overseas forces tax offset if you served in a specified overseas locality as a member of the Australian Defence Force or a United Nations armed force in 2014–15 and income relating to that service was not specifically exempt from tax. Periods of service for which your income was ‘exempt foreign employment income’ are excluded in working out your eligibility for the tax offset.

Your employer will be able to advise you whether you served in a locality that qualifies for the overseas forces tax offset. You can also see which localities qualify for the overseas forces tax offset at Overseas forces tax offset or phone 13 28 61.

To claim the full tax offset, you must have served in the overseas locality for 183 days or more in 2014–15. If your overseas service was less than 183 days, you may be able to claim part of the tax offset. Unlike the zone tax offset, you cannot carry forward any unused days from previous years to make up 183 days.

If you served in an overseas locality for less than 183 days, but the total number of days served in the overseas locality, when added to the number of days spent in one or more zones, is 183 days or more, you may still be entitled to claim the full overseas forces tax offset. If you served as a member of the Australian Defence Force, days spent in a zone must be defence force service.

If you qualify for both an overseas forces tax offset and a zone tax offset, you can claim only one of them. Claim the higher one.

Completing this item

The zone or overseas forces tax offset is made up of:

• a fixed amount
• a base amount.

The fixed amount is a prescribed amount available to all people in the zone or overseas area eligible for the tax offset.

You may be able to include a base amount if you:

• maintained a child under 21 or full time student under 25; or
• were entitled to claim the Invalid and invalid carer offset (see T6).

Your fixed and base amounts are determined by your circumstances.

How to work out your tax offset if your circumstances were simple

Step 1

Your tax offset is the amount in table 1 if:

• you lived or worked in only one zone or served in only one specified overseas locality for at least 183 days
• you are not able to include a base amount as
  • you were not entitled to claim the invalid and invalid carer tax offset
  • you either did not have a dependent child or student at any time in 2014–15, or if you did have a dependent child or student, their adjusted taxable income (ATI) was equal to or greater than $282 plus $28.92 for each week you maintained them.
   

Table 1: Tax offset amounts

Zone A	Zone B	Special area	Overseas forces
$338	$57	$1,173	$338

Child includes your adopted child, stepchild, ex-nuptial child and child of your spouse. See the definition of child in Special circumstances and glossary.

A student must be full-time at a school, college or university.

If you cannot use table 1 you will need to work through How to work out your offsets if your circumstances were more complex.

If you received a remote area allowance from Centrelink or the Department of Veterans’ Affairs you must reduce the amount of your zone tax offset by the amount you received for this allowance.

Step 2

Write your tax offset amount less any remote area allowance at R item T4 on page 16 of your tax return. Do not show cents. Go to question T5 Total net medical expenses.

How to work out your tax offset if your circumstances were more complex

You can either use our Zone or overseas forces tax offset calculator on our website or see Working out your total base amount.

The following information will help you work out your base amount, if any.

Dependent child or student base amount

Full-year claim

Your base amount will include the maximum amount shown in table 2 for each student under 25 years old on 30 June 2015 in full-time education at a school, college or university, and for each child under 21 years on 30 June 2015 who, for the whole of 2014–15:

• was treated as an Australian resident
• was maintained by only you, and
• had an ATI of less than $286

To calculate the ATI see Adjusted taxable income (ATI) for you and your dependants or use the Income tests calculator.

If you did not have any dependent children or students, go to Invalid and invalid carer base amount.

Table 2

Dependant	Base amount
Each student under 25 years old	$376
For the oldest non-student child under 21 years old	$376
Other non-student children under 21 years old	$282 for each child

If all of these requirements were met, add up the base amount for each child or student and write the total at (a) table 3.

If two or more people contributed to the maintenance of a dependent child or student, each person can only claim a proportion of the base amount.

If the requirements were met for only part of the year, or your child’s or student’s ATI for the period you are claiming this base amount in respect of them was $286 or more, you may be able to claim for a part of the base amount. Read on.

Part-year claim

You can claim only part of the base amount for dependent children or students if:

• the child or student was treated as an Australian resident for only part of 2014–15
• the student was under 25 years old and in full-time education for only part of 2014–15
• the child or student was maintained by you for only part of 2014–15
• the child was 21 years old at 30 June 2015 and not in full-time education, or
• the student was 25 years old at 30 June 2015.

Use worksheet 1 to work out the reduced base amount for each eligible dependent child or student as described in table 2.

Worksheet 1
Maximum base amount for the child or student from table 2	$	(a)
Number of days you maintained your child or student and your child or student was an eligible dependant		(b)
Number of days in 2014–15	365	(c)
Divide (b) by (c).	$	(d)
Multiply (d) by (a).	$	(e)

If the ATI of your child or student was less than $286 for the period you are claiming this base amount in respect of them, transfer amount (e) above to (a) table 3.

If you had more than one eligible child or student and the ATI of each one was less than $286 for the period you are claiming this base amount in respect of them, work out the amount for each child and student, add up all the amounts and write the total at (a) table 3.

If ATI was $286 or more for the period you maintained them

You cannot claim any base amount for your child or student if that child or student had an ATI equal to or greater than:

• the total of $282 plus $28.92 for each week you maintained them for a student under 25 years old or for the oldest child under 21 years old who is not a student, or
• the total of $282 plus $21.70 for each week you maintained them for any other child under 21 years old who is not a student.

If your child’s or student’s ATI for the period you are claiming this base amount in respect of them was $286 or more but less than the limits shown, use worksheet 2 to work out the base amount.

Worksheet 2
Base amount for the child or student from table 2 or (e) worksheet 1 for a part-year claim	$	(a)
Your child’s or student’s ATI for the period you maintained them	$	(b)
Income above which the base amount begins to reduce	$282	(c)
Take (c) away from (b).	$	(d)
Divide (d) by 4 because your base amount is reduced by $1 for every $4 of ATI over $282. Do not show cents.	$	(e)
Take (e) away from (a). Show zero (0) if the amount is negative. Do not show cents..	$	(f)

Transfer the amount at (f) above to (a) table 3. If you had more than one eligible child or student, work out the amount for each child or student, add up all the amounts and write the total at (a) table 3.

Sole parent base amount

If you had sole care of a dependent child or student and you have written an amount of at least $1 at (a) table 3 (base amount for dependent children or students), you may also be eligible for a sole parent base amount.

You can only claim this base amount if you:

• were a sole parent at any time during the income year and
• lived or worked in a remote area of Australia or
• served overseas as a member of the Australian Defence Force

Sole care means that you alone had full responsibility on a day-to-day basis for the upbringing, welfare and maintenance of a child or student. We do not consider you to have had sole care if you were living with a spouse (married or de facto) during the year unless special circumstances exist.

You will need to use worksheet 3 to calculate a part-year sole parent base amount claim.

Special circumstances

If you had a spouse (married or de facto) at any time during 2014–15, you are entitled to a sole parent base amount only in special circumstances.

Generally, for special circumstances to exist, you must have been financially responsible for and have had sole care of the dependent child or student, without the support a spouse normally provides.

Examples of situations where special circumstances may arise:

• You were married or in a de facto relationship at any time during 2014–15, but during the year you separated from or were deserted by your spouse, and for the period that you will claim the sole parent base amount you were not in a de facto relationship.
• Your spouse was in prison for a sentence of at least 12 months.
• Your spouse was medically certified as being permanently mentally incapable of taking part in caring for your child or student.

If you are unsure whether special circumstances applied, then phone 13 28 61.

Shared or joint custody after a relationship breakdown

There are times, after a relationship breakdown, such as a divorce or separation, where both parents share the custody of a child or student. If you can show that you had sole care of a dependent child or student for part of the year, you may be able to claim the base amount for that part of the year. This means more than just having access visits with the child or student.

We consider you to have had sole care of the child or student for the part of the year up to the day the child turned 21 years old or the student turned 25 years old if the dependant:

• was not receiving full-time education and turned 21 years old during 2014–15, or
• was a full-time student and turned 25 years old during 2014–15.

You are only entitled to claim the base amount for that part of the year before the birthday.

If you had sole care of a child or student for the whole of 2014–15, write $1,607 at (b) table 3.

Worksheet 3

Sole parent base amount, part-year claim
Number of days you had sole care of a child or student	$	(a)
Multiply (a) by $4.40.	$	(b)

Transfer the amount at (b) above to (b) table 3.

Invalid and invalid carer base amount

If you are entitled to a tax offset at T6 Invalid and invalid carer you are entitled to this base amount. To be eligible you must have maintained:

• your spouse who was an invalid or cared for an invalid, or
• your or your spouse's parent, who lived in Australia and who was an invalid or cared for an invalid, or
• your or your spouse’s invalid child aged 16 years or older, or brother or sister aged 16 years or older

Use our calculator to determine if you are eligible for this offset and the amount you are entitled to claim. Alternatively, if you wish to manually calculate your entitlement go to T6 Invalid and invalid carer.

If you are entitled to an offset at T6 Invalid and invalid carer, write the amount you calculated at (c) table 3.

Working out your total base amount

Use table 3 to work out your total base amount.

Table 3

Total base amount
Dependent children or students, from table 2, worksheet 1 or worksheet 2		(a)
Sole parent		(b)
Amount claimed at item T6 Invalid and invalid carer tax offset		(c)
Add up all of these amounts.	$	(d)

The amount at (d) is your total base amount.

Read on.

You use the information from table 4 when you complete either table 5 or 6.

Table 4

	Fixed amount	Percentage of base amount
Zone A	$338	50%
Zone B	$57	20%
Special area	$1,173	50%
Overseas forces	$338	50%

Final calculation

Multiple locations

If you lived or worked in more than one zone, special area or specified overseas locality, and you were in one of them for 183 days or more, check table 4. If the fixed amount for that zone is higher than for the other zones where you were, use that fixed amount and table 5 to work out your tax offset. This will give you the greatest benefit.

Otherwise go to category 2.

Category 1

You were in only one zone or served only in specified overseas localities for at least 183 days.

Step 1

Complete table 5.

Table 5
Your fixed amount from table 4	$	(a)
Your base amount from (d) table 3	$	(b)
Multiply (b) by the percentage figure from table 4.	$	(c)
Add (a) and (c).	$	(d)
If you are claiming an overseas forces tax offset, the amount you can claim is (d). Go to step 2. If you are claiming a zone tax offset, read on.
Any remote area allowance you received.	$	(e)
Take (e) away from (d) and write the answer at (f)	$	(f)

The amount at (f), if it is more than zero (0), is your zone tax offset. Go to step 2.

Step 2

Write your zone or overseas forces tax offset amount at R item T4 on your tax return. Do not show cents. Go to question T5 Total net medical expenses.

Category 2

You:

• lived or worked in more than one zone, or
• served in a specified overseas locality for less than 183 days, or
• served in a specified overseas locality and you were in one or more zones for a total of at least 183 days.

You claim for the number of days in each eligible place divided by 183, to a maximum of 183 days for a year. Start with your zone that has the highest fixed amount in table 4. This will give you the greatest benefit.

Step 1

Use table 6 to work out your claim for each zone, special area or overseas locality you were in (as in the examples).

Table 6
Your fixed amount from table 4	$	(a)
Your base amount from (d) table 3	$	(b)
Multiply (b) by the percentage figure from table 4.	$	(c)
Add (a) and (c).	$	(d)
Number of days spent or served there to a maximum of 183 days (see the examples)	$	(e)
Multiply (d) by (e).	$	(f)
Divide (f) by 183. This is the amount you can claim.	$	(g)

Step 2

Once you have worked out the amount you can claim for each place you were in, add up all the amounts and then use table 7 to work out your total tax offset.

Table 7
Total of the amounts you have worked out for each zone from (g) table 6.	$	(a)
If you are claiming an overseas forces tax offset, the amount you can claim is (a). Go to step 3. If you are claiming a zone tax offset, read on.
Any remote area allowance you received	$	(b)
Take (b) away from (a). This is the amount you can claim.	$	(c)

The amount at (c), if it is more than zero (0), is the total of your zone tax offset. Go to step 3.

Step 3

Write your zone or overseas forces total tax offset amount at R item T4. Do not show cents. Go to question T5 Total net medical expenses.

Selected localities within the zones and special areas

Table 8: Zone A

Western Australia	Northern Territory
Bidyadanga (Lagrange)	Alice Springs*
Broome*	Batchelor
Carnarvon	Darwin
Dampier	Hermannsburg
Derby	Katherine*
Goldsworthy	Pine Creek
Karratha	Santa Teresa
Marble Bar	Tindal
Newman*
Pannawonica
Paraburdoo
Port Hedland*	Queensland
Roebourne	Camooweal
Shay Gap	Cloncurry
Tom Price*	Mount Isa*
Wittenoom

* Locations within 250 kilometres of these localities are also in the relevant zone.

Table 9: Zone B

Western Australia	Queensland
Boulder	Airlie Beach
Coolgardie	Atherton
Esperance	Augathella
Kalgoorlie*	Ayr
Kambalda	Barcaldine
Leonora	Blackall
Mullewa	Bowen
Norseman	Cairns
Northampton	Cardwell
Ravensthorpe	Charleville
Southern Cross	Charters Towers
	Clifton Beach
New South Wales	Collinsville
Bourke	Coppabella
Brewarrina	Cunnamulla
Broken Hill	Greenvale
Cobar	Home Hill
Collarenebri	Ingham
Lightning Ridge	Innisfail
Menindee	Longreach
Wilcannia	Mackay
	Mareeba
	Mossman
Tasmania	Port Douglas
Queenstown	Proserpine
Rosebery	Quilpie
	Sarina
	Tambo
South Australia	Townsville
Woomera	Tully
	Winton

* Locations within 250 kilometres of these localities are also in the relevant zone.

Table 10: Special areas

Western Australia	Queensland
Balladonia	Boulia
Deakin	Burketown
Denham	Cooktown
Eucla	Doomadgee
Exmouth	Georgetown
Fitzroy Crossing	Helen Vale
Halls Creek	Hughenden
Kununurra	Julia Creek
Laverton	Karumba
Leinster	Kowanyama
Madura	Normanton
Meekatharra	Stamford
Mount Magnet	Thargomindah
Onslow	Weipa
Rawlinna	Windorah
Turkey Creek (Bow River)
Wiluna
Wyndham	South Australia
	Amata Aboriginal Community
	Coober Pedy
Northern Territory	Cook
Alyangula	Innamincka
Angurugu	Leigh Creek
Borroloola	Marree
Elliott	Nullarbor
Galiwinku	Oodnadatta
Jabiru	Penong
Lajamanu (Hooker Creek)	Roxby Downs
Maningrida	Tarcoola
Milikapiti
Milingimbi
Nguiu	New South Wales
Ngukurr	White Cliffs
Nhulunbuy (Gove)
Numbulwar
Oenpelli	Islands and territories
Papunyah	Australian Antarctic Territory
Ramingining	Cocos (Keeling) Islands
Tennant Creek	Heard Island
Yirrkala	Lord Howe Island
Yuendumu	Macquarie Island
Yulara	McDonald Islands
	Norfolk Island
	Palm Isles Group
Tasmania
Furneaux Group Islands
King Island

There are also other locations that may be in a zone or special area. If you are unsure, phone 13 28 61.

Where to go next

• Go to question T5 Total net medical expenses.
• Return to main menu Individual tax return instructions.
• Go back to question T3 Superannuation contributions on behalf of your spouse.

Provides information to help you determine your entitlement to a zone or overseas forces tax offset.