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Income Tax Act 2007

Income - Exempt income

CW 17CC: Payments for distinctive work clothing

You could also call this:

“Money for work clothes isn't taxed in certain cases”

If your employer pays for your distinctive work clothing, you don’t have to pay tax on that money. Distinctive work clothing is defined in section CX 30.

Sometimes, you might have to wear your own plain clothes for work instead of a uniform. If this happens, your employer might give you money to pay for these clothes. You don’t have to pay tax on this money if:

  1. Your employer provides uniforms for employees, but
  2. They ask you to wear your own clothes for work instead, and
  3. Your employer’s rules said they would pay for plain clothes on 1 July 2013, and
  4. In the past, the money for plain clothes was part of a bigger payment, where some of it was taxed as part of your pay, and
  5. Your employer still follows these rules about paying for plain clothes.

If all of these things are true, the money your employer gives you for plain clothes is not taxed.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM6191734.

Topics:
Money and consumer rights > Taxes
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Part C Income
Exempt income

CW 17CCPayments for distinctive work clothing

  1. An amount that an employer pays to or on behalf of an employee for distinctive work clothing for the employee is exempt income of the employee.

  2. For the purposes of this section, distinctive work clothing has the meaning set out in section CX 30 (Distinctive work clothing).

  3. Despite subsection (2), for the purposes of subsection (4), the wearing of distinctive work clothing by an employee includes the wearing of plain clothes that would normally be worn for private purposes if—

  4. their employer provides a uniform to employees; and
    1. despite the provision of a uniform, the employer requires the employee to wear plain clothes in the performance of their employment duties; and
      1. as at 1 July 2013, the employer's general terms and conditions of employment or service provided for allowances for plain clothes to be paid to employees; and
        1. historically, the plain clothes allowance was part of a larger amount paid at the time by the employer to employees in relation to the provision of plain clothes, the balance being a taxable amount that was at a later period classified as remuneration for employees then receiving the plain clothes allowance under the employer's general terms and conditions; and
          1. the terms and conditions referred to in paragraph (c) continue to provide for the payment of the plain clothes allowance.

            1. The amount that the employer pays to or on behalf of the employee as an allowance for the plain clothes is exempt income of the employee.

            Notes
            • Section CW 17CC: inserted (with effect on 1 July 2013), on , by section 27 of the Taxation (Annual Rates, Employee Allowances, and Remedial Matters) Act 2014 (2014 No 39).