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Inland Revenue

Tax Policy

Taxation of employer-provided accommodation/accommodation allowances

New clause

Issue: Remedial amendment – taxation of employer-provided accommodation and accommodation allowances



There should be an urgent remedial amendment to section CE 1(1B) of the Income Tax Act 2007, to ensure that accommodation provided by an employer to an employee (or accommodation allowance) is only taxable when there is a private benefit to the employee. Where an employee is temporarily relocated to a different city or country, but incurs costs maintaining their regular home, there is no private benefit from accommodation provided by their employer in the other country or city.


The tax treatment of accommodation allowances and accommodation provided to employees is being considered as part of a more general review of employee allowances and other employee expenditure payments. Consultation on an officials’ paper, Reviewing the tax treatment of employee allowances and other expenditure payments, closed in February and submissions are currently being considered. That would be the appropriate arena for considering any issues relating to the taxation of accommodation or accommodation allowances provided to employees.


That the submission be declined.