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Income Tax Act 2007

Income - Terminating provisions

CZ 24: Employee benefits for Canterbury earthquake relief: not fringe benefits

You could also call this:

“Earthquake relief benefits from employers aren't taxed as fringe benefits”

If you receive a benefit from your employer to help you with the effects of the Canterbury earthquakes of 4 September 2010 or 22 February 2011, it might not be considered a fringe benefit. This applies if the benefit meets certain conditions.

The benefit must be given within 8 weeks of the earthquake. It can’t replace your regular pay, and it can’t depend on how senior you are at work. If you’re closely connected to your employer, the same benefit must be available to other employees who aren’t connected to the employer.

Your employer must treat the benefit as if it’s not a fringe benefit. If your employer can estimate the value of the benefit, it won’t be a fringe benefit if its value is less than or equal to $3,200 minus any earthquake-related pay you’ve already received that’s tax-free under section CZ 23(2)(b).

If your employer can’t estimate the value of the benefit, it won’t be considered a fringe benefit at all.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM3824876.

Topics:
Money and consumer rights > Taxes
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“Tax-free employer assistance for North Island flood-affected workers”

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CZ 24B: Employee benefits for North Island flooding events relief: not fringe benefits, or

“Tax-free employer benefits for North Island flood victims”

Part C Income
Terminating provisions

CZ 24Employee benefits for Canterbury earthquake relief: not fringe benefits

  1. This section applies when an employee receives from an employer a benefit that—

  2. would be a fringe benefit in the absence of this section; and
    1. is for the purpose of the relief of employees from the adverse effects of a Canterbury earthquake, as defined in section 4 of the Canterbury Earthquake Recovery Act 2011, of 4 September 2010 or 22 February 2011; and
      1. is received in the period of 8 weeks beginning on the day of that Canterbury earthquake; and
        1. does not replace a PAYE income payment; and
          1. does not depend on the seniority of the employee; and
            1. is available to another employee, who is not an associated person of the employer and is or was immediately before a Canterbury earthquake in full-time employment with the employer, if the employee is an associated person of the employer; and
              1. is treated by the employer as not being a fringe benefit.

                1. Benefits satisfying subsection (1) that would, in the absence of this section, be fringe benefits having a value for the employee that the employer could estimate, are not fringe benefits to the extent that their total value as fringe benefits for the period would be less than or equal to the amount by which $3,200 exceeds the income that is—

                2. exempt income under section CZ 23(2)(b); and
                  1. derived by the employee from the employer in the same period.

                    1. Benefits satisfying subsection (1) that would, in the absence of this section, be fringe benefits having a value for the employee that the employer could not estimate, are not fringe benefits.

                    Notes
                    • Section CZ 24: added (with effect on 4 September 2010), on , by section 4 of the Taxation (Canterbury Earthquake Measures) Act 2011 (2011 No 24).