Taxation Ruling

IT 2030 (as amended 25.01.85)

Income tax: value of employees' housing for tax instalment deduction purposes: 'remote' towns - for s.26AAAB purposes

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FOI status:

May be releasedFOI number: I 1104137

PREAMBLE

For the purposes of computing tax instalment deductions from remuneration paid to an employee, section 221C of the Income Tax Assessment Act 1936 requires that an employee be deemed to have received as salary or wages, in addition to any actual payment of money, the amount fixed by any award as the value to the employee of the use of accommodation or quarters provided by his or her employer. Under section 221D, the Commissioner is authorised to vary the amount of instalments to be deducted from the salary or wages of an employee or a class of employees to meet special circumstances.

2. An employer with a large number of employees in various locations who are eligible under section 26AAAB for the concessional basis of determining the assessable value of residential accommodation provided to them by the employer sought, as a matter of administrative convenience, approval of the Commissioner to adopt a notional annual rental value for general use in calculating tax instalment deductions of such employees. An industrial award governing the conditions of employment of employees in the particular industry fixed monetary values on the housing supplied to the employees by reference to the localities in which the housing was situated.

3. The employer also submitted a list of towns in which employees were located and sought agreement with its classification of the towns identified according to whether or not they were "remote", i.e., whether they were not at or adjacent to an eligible urban area within the meaning of sub-paragraph 26AAAB(1)(a).

RULING

4. The Commissioner has exercised his power under Section 221D of the Income Tax Assessment Act to allow the employer to adopt a notional rental value, for PAYE purposes only, of $6 per week for employees who occupy employer-provided accommodation and who meet the "remoteness" test of sub-paragraph 26AAAB(1)(a). This figure represents a weekly rental value of $60 which is considered widely representative of housing accommodation values in "remote" areas.

5. It is, nevertheless, open to an employee to establish that the value for a particular unit of accommodation is something less than $6 per week. Any application for a lesser value would need to be supported by full details of the accommodation.

6. If an employee pays rent in respect of employer-provided accommodation, the notional value of $6 per week would be reduced by the amount of rent paid. For example, an employee who pays rent of $6 per week or more would have his or her notional value reduced from $6 per week to nil.

7. The notional figure of $6 per week is only for convenience of application of the PAYE system and does not represent the value to be returned as assessable income by the employee. Taxpayers who seek the benefit of the section 26AAAB concession will need to either calculate the amount to be included in their assessable income of a particular year by reference to the actual market rental value of the particular accommodation in the base year or furnish sufficient information to enable the assessable value to be determined.

8. The notional annual rental value of $312 ($6 per week) used for PAYE purposes is not to be shown by the employer at label Q, Column 2 of the employee's group certificate. The amount shown at this label should be the full value of residential accommodation provided to the employee.

9. The towns listed by the employer have been categorised as either "remote" or "non-remote" for the purposes of section 26AAAB. It should be noted that this list is not intended to be an exhaustive list of all towns throughout Australia which may be categorised as "remote" or "non-remote".

COMMISSINER OF TAXATION
25 January 1985

APPENDIX

REMOTE

New South Wales

BARRABA

BATEMANS BAY

BEGA

BOMBALA

BOURKE

BREWARRINA

BYRON BAY

CANOWINDRA

COBAR

CONDOBOLIN

COOMA

COONABARABRAN

COONAMBLE

COOTAMUNDRA

COROWA

COWRA

CROOKWELL

DENILIQUIN

EDEN

FINLEY

FORBES

GILGANDRA

GLEN INNES

GLOUCESTER

GRENFELL

GRIFFITH

GULGONG

GUNDAGAI

GUNNEDAH

HARDEN

HAY

HENTY

INVERELL

IVANHOE

JUNEE

KANDOS

KEMPSEY

KYOGLE

LEETON

LOCKHART

MACKSVILLE

MACLEAN

MANILLA

MERIMBULA

MERRIWA

MOREE

MORUYA

MUDGEE

MULLUMBIMBY

MURRURUNDI

MUSWELLBROOK

NAMBUCCA HEADS

NAROOMA

NARRABRI

NARRANDERA

NARROMINE

NYNGAN

OBERON

PARKES

QUIRINDI

SCONE

TEMORA

TENTERFIELD

TUMUT

ULLADULLA

WALCHA

WALGETT

WARREN

WELLINGTON

WERRIS CREEK

WEST WYALONG

YOUNG

REMOTE

Victoria

ARARAT

BAIRNSDALE

CAMPERDOWN

COLAC

ECHUCA

HAMILTON

HORSHAM

KERANG

KORUMBURRA

LEONGATHA

MARYBOROUGH

MYRTLEFORD

PORTLAND

STAWELL

SWAN HILL

WARRACKNABEAL

YARRAWONGA

REMOTE

Queensland

ATHERTON

AYR

BABINDA

BARCALDINE

BILOELA

BLACKALL

BLACKWATER

BOWEN

CALOUNDRA

CHARLEVILLE

CHARTERS TOWERS

CHILDERS

CHINCHILLA

CLERMONT

COLLINSVILLE

COOROY

CUNNAMULLA

DALBY

EMERALD

GAYNDAH

GOONDIWINDI

GYMPIE

HOME HILL

HUGHENDEN

INGHAM

INNISFAIL

KAWANA WATERS

KINGAROY

LONGREACH

MAREEBA

MAROOCHYDORE

MILES

MONTO

MOSSMAN

MUNDUBBERA

MURGON

NAMBOUR

NANANGO

PITTSWORTH

PROSERPINE

RAVENSHOE

ROMA

ST GEORGE

STANTHORPE

TEWANTIN

TULLY

WARWICK

YEPOON

WEIPA

REMOTE

South Australia

BORDERTOWN

CLARE

KADINA

LOXTON

MILLICENT

NARACOORTE

PORT LINCOLN

RENMARK

STREAKY BAY

WOOMERA

REMOTE

Northern Terrirory

KATHERINE

REMOTE

Western Australia

BOYUP BROOK

BRIDGETOWN

BROOME

BUSSELTON

CARNARVON

COLLIE

ESPERANCE

HARVEY

KARRATHA

KATANNING

KUNUNURRA

MANJIMUP

MERREDIN

MOORA

MOUNT BARKER

NARROGIN

NORSEMAN

PORT HEDLAND

WAGIN

REMOTE

Tasmania

GEORGE TOWN

QUEENSTOWN

SCOTTSDALE

SMITHTON

NON-REMOTE

New South Wales

ALBURY

ARMIDALE

BALLINA

BATHURST

BELLINGEN

BLACKHEATH

BLAXLAND

BLAYNEY

BOWRAL

BROKEN HILL

CAMDEN

CAMPBELLTOWN

CASINO

CESSNOCK

COFF'S HARBOUR

CORRIMAL

DUBBO

DUNGOG

ETTALONG BEACH

FAIRY MEADOW

FORSTER

GOSFORD

GOULBURN

GRAFTON

GUYRA

KATOOMBA

KIAMA

KURRI KURRI

LAURIETON

LISMORE

LITHGOW

MAITLAND

MITTAGONG

MOLONG

MORISSETT

MOSSVALE

MURWILLUMBAH

NELSON BAY

NEWCASTLE

NORTH ALBURY

NOWRA

ORANGE

PENRITH

PICTON

PORTLAND

PORT MACQUARIE

QUEANBEYAN

RAYMOND TERRACE

RICHMOND

RIVERSTONE

SINGLETON

SHELL HARBOUR

SOUTH WAGGA WAGGA

SPRINGWOOD

ST MARYS

TAMWORTH

TAREE

TERRIGAL

THE ENTRANCE

THIRROUL

TOUKLEY

TWEED HEADS

UMINA BEACH

URALLA

WAGGA WAGGA

WAUCHOPE

WESTON (ACT)

WINDSOR

WINGHAM

WOLLONGONG

WOONONA

WOY WOY

WYONG

YASS

NON-REMOTE

Victoria

BACCHUS MARSH

BALLARAT

BELMONT

BENALLA

BENDIGO

BERWICK

CASTLEMAINE

CORIO

GEELONG

GEELONG WEST

HASTING

KYABRAM

KYNETON

MILDURA

MOE

MORNINGTON

MORWELL

NUMURKAH

ROSEBUD

SALE

SEYMOUR

SHEPPARTON

SUNBURY

TATURA

TRARALGON

WANGARATTA

WARRAGUL

WARRNAMBOOL

WERRIBEE

WODONGA

NON-REMOTE

Queensland

AITKENVALE

BEAUDESERT

BOONAH

BRIBIE ISLAND

BUNDABERG

BURLEIGH HEADS

CABOOLTURE

CAIRNS

COOLANGATTA

GATTON

GLADSTONE

GORDONVALE

HERMIT PARK

IPSWICH

KILCOY

LAIDLEY

MACKAY

MARYBOROUGH

MOUNT MORGAN

MOUNT ISA

NORTH ROCKHAMPTON

OAKEY

PIALBA

ROCKHAMPTON

SARINA

SOUTHPORT

SURFERS PARADISE

TOOWOOMBA

TOWNSVILLE

NON-REMOTE

South Australia

GAWLER

MOUNT GAMBIER

MURRAY BRIDGE

NURIOOTPA

PORT AUGUSTA

PORT PIRIE

STRATHALBYN

VICTOR HARBOUR

WHYALLA

WHYALLA NORRIE

NON-REMOTE

Northern Territory

ALICE SPRINGS

CASUARINA

DARWIN

NON-REMOTE

Western Australia

ALBANY

BOULDER

BUNBURY

GERALDTON

KALGOORLIE

MANDURA

NORTHAM

YORK

NON-REMOTE

Tasmania

BURNIE

CYGNET

DEVONPORT

LAUNCESTON

MOWBRAY

NEW NORFOLK

ULVERSTONE

ERRATUM

TAXATION RULING NO. IT 2030

Page 3 - after "WARREN" insert "WELLINGTON"

Page 10 - delete "WELLINGTON"

References

ATO references:
NO S 104/1/53 P1 F134

Date original memo issued:
17.01.83

Related Rulings/Determinations:

IT 2030W

Subject References:
SUBSIDISED HOUSING
EMPLOYEES' HOUSING
VALUE OF EMPLOYEES' HOUSING
TAX INSTALMENT DEDUCTIONS
"REMOTE" TOWNS
"NON-REMOTE" TOWNS
NOTIONAL ANNUAL RENTAL VALUE

Legislative References:
26AAAB
221D