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LAFHA reasonable amounts for food and drink 2013

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The ATO has released Taxation Determination TD 2013/4, which sets out the amounts the Commissioner considers reasonable under s 31G of the Fringe Benefits Tax Assessment Act 1986 for food and drink expenses incurred by employees receiving a living-away-from-home allowance (LAFHA) fringe benefit in the period 1 April 2013 to 31 March 2014.

If the total of food and drink expenses for an employee (including eligible family members) does not exceed the amount the Commissioner considers reasonable, the taxable value of a LAFHA fringe benefit is reduced by the exempt food component (and substantiation is not required).

If the total of an employee’s food or drink expenses exceeds the amount the Commissioner considers reasonable, the exempt food component is so much of the food and drink expenses (less the applicable statutory food total) as are substantiated by the employee. If the food and drink expenses exceed the reasonable amount and are not substantiated in full, only the reasonable amount will be exempt.

The Determination sets out reasonable amounts for food and drink for a LAFHA for a one-week (seven-day) period. Where the period is longer than one week, the total reasonable amount for the period is calculated by multiplying the weekly amount by the total number of weeks (and any part thereof). The weekly amounts for food and drink include breakfast, lunch and dinner. The figures cover amounts expended on all food and drink, including meals in restaurants, hotels, clubs, etc as well as fast food and takeaway food and alcoholic beverages.

Separate reasonable amounts apply for locations within Australia and for locations overseas. The weekly amounts for locations within Australia are as follows (and for large family groupings, add $117 for each additional adult and $59 for each additional child):

  • 1 adult – $233;
  • 2 adults – $350;
  • 3 adults – $467;
  • 1 adult and 1 child – $292;
  • 2 adults and 1 child – $409;
  • 2 adults and 2 children – $468;
  • 2 adults and 3 children – $527;
  • 3 adults and 1 child $526;
  • 3 adults and 2 children – $585; and
  • 4 adults – $584.

The Determination was previously issued as Draft TD 2012/D8.

Date of effect

The Determination applies only to the FBT year beginning on 1 April 2013. As a transitional measure for the FBT year commencing on 1 April 2013, where an employee and employer have an existing employment agreement in force as at 27 February 2013 that specifies a rate in the previously released TD 2012/5, and that employment agreement is not varied in a material way or renewed, the rates in TD 2012/5 will continue to be accepted by the Commissioner as reasonable amounts under s 31G.

Source: Taxation Determination TD 2013/4, http://law.ato.gov.au/atolaw/view.htm?DocID=TXD/TD20134/NAT/ATO/00001&PiT=99991231235958.

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