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Income Tax Act 2007

Income - Employee or contractor income

CE 1B: General rule: accommodation provided by employers

You could also call this:

“Employer-provided accommodation or housing payments count as income”

If you work for someone, they might give you a place to live or money to help with your housing. This is called accommodation. The law says this accommodation is part of your income.

If your employer gives you a place to live, the value of your income is the same as what you would pay to rent that place normally.

If your employer gives you money to help with housing, all of that money counts as your income.

If your employer pays for your housing directly, that payment also counts as your income.

Sometimes, the value of the accommodation might be adjusted. This can happen if:

You share the accommodation with other people. In this case, the value might be split equally among everyone, or in another fair way if everyone agrees.

You pay some money towards the accommodation yourself. The value of your income will be reduced by the amount you pay.

You use part of the accommodation for work. The value might be split between personal use and work use.

These adjustments can also apply if you get money for housing instead of an actual place to live.

There are some other rules in [Sections CE 1C and CE 1E] that might change how this works in certain situations.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM6439711.

Topics:

Money and consumer rights > Taxes

CE 1: Amounts derived in connection with employment, or

“Income you must include from your job or service”

CE 1C: Exception: overseas accommodation, or

“Tax rules for employer-provided overseas accommodation”

Part C Income
Employee or contractor income

CE 1BGeneral rule: accommodation provided by employers

The value of accommodation provided to a person is income of the person when it is provided in relation to their employment or service. The value is an amount equal to the market rental value of the accommodation.
The value of an accommodation allowance provided to a person is income of the person when it is provided in relation to their employment or service. The value is equal to the amount of the allowance paid to the person.
An amount paid for or towards the provision of accommodation for a person, whether as expenditure on account of an employee or as a reimbursement, is income of the person when it is paid in relation to their employment or service.
The value under subsection (1) may be adjusted as follows:
when more than 1 person referred to in that subsection shares in the accommodation provided, the amount may be—
1. apportioned equally among the number of persons referred to in that subsection who are sharing in the accommodation; or
2. if the persons referred to in that subsection who are sharing in the accommodation agree with the person providing the accommodation, apportioned on another reasonable basis:
when the person to whom the accommodation is provided contributes towards their occupation of the accommodation, the amount may be reduced by the amount contributed:
when the person to whom the accommodation is provided uses part of the accommodation wholly or mainly for work purposes related to their employment or service, the amount may be apportioned between business use and private use.

Subsection (4)(b) and (c) may apply to adjust the value of an accommodation allowance or an amount paid for or towards the provision of accommodation under subsections (2) and (3).
Sections CE 1C and CE 1E override this section.

Notes

Section CE 1B: inserted, on 1 April 2015, by section 15 of the Taxation (Annual Rates, Employee Allowances, and Remedial Matters) Act 2014 (2014 No 39).