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Income Tax Act 2007

Income - Terminating provisions

CZ 23: Employee benefits for Canterbury earthquake relief: exempt income

You could also call this:

“Tax-free benefits for workers affected by Canterbury earthquakes”

If you work for an employer who provides you with benefits to help you recover from the Canterbury earthquakes of 4 September 2010 or 22 February 2011, some of these benefits might not be taxed. This applies to benefits you receive within 8 weeks of the earthquake.

For these benefits to be tax-free, they must meet several conditions. They can’t replace your regular pay, and they must be available to all employees, not just senior ones. If you’re closely connected to your employer, other employees who aren’t connected must be able to get the same benefits.

There are limits to how much of these benefits can be tax-free. If your employer provides you with a place to stay, all of that is tax-free. For any other type of benefit, up to $3,200 in total is tax-free.

Your employer needs to treat these benefits as tax-free income for you. The law that defines what a Canterbury earthquake is can be found in section 4 of the Canterbury Earthquake Recovery Act 2011.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM4483203.

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“Removed: Rules for Canterbury earthquake building compensation no longer apply”

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CZ 23B: Employee benefits for North Island flooding events: exempt income, or

“Tax-free employer assistance for North Island flood-affected workers”

Part C Income
Terminating provisions

CZ 23Employee benefits for Canterbury earthquake relief: exempt income

  1. Income derived by an employee from an employer is exempt income to the extent given by subsection (2) if the income—

  2. would be assessable income in the absence of this section; and
    1. is provided by the employer for the purpose of 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 derived 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 being exempt income for the employee.

                1. Income satisfying subsection (1) is exempt income to the extent that the income is—

                2. accommodation:
                  1. less than or equal to $3,200 in total, if the income is in a form other than accommodation.

                    Notes
                    • Section CZ 23: inserted (with effect on 4 September 2010), on , by section 4 of the Taxation (Canterbury Earthquake Measures) Act 2011 (2011 No 24).
                    • Section CZ 23(2)(a): amended (with effect on 4 September 2010), on , by section 36(1) of the Taxation (Annual Rates, Employee Allowances, and Remedial Matters) Act 2014 (2014 No 39).
                    • Section CZ 23 list of defined terms accommodation: inserted (with effect on 4 September 2010), on , by section 36(2) of the Taxation (Annual Rates, Employee Allowances, and Remedial Matters) Act 2014 (2014 No 39).