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Income Tax Act 2007

Income - Employee or contractor income

CE 1E: Exception: accommodation provided to ministers of religion

You could also call this:

“Religious leaders' housing provided by their organisation may count as taxable income”

If you are a minister of religion, the accommodation provided to you by your religious society or organisation might be counted as part of your income. This rule applies when the property where you live is supplied by the religious group you work for.

The amount of income from your accommodation is worked out using a special formula. This formula takes into account 10% of your pay for your work as a minister, how much of the accommodation you use for work, and whether the accommodation is more valuable than what you need for your job.

If you use part of your home for work purposes related to being a minister, that part isn’t counted as income. If you share the accommodation with other ministers, the income is split equally between you.

For this rule, a minister of religion means someone who is officially appointed as a minister in a religious group. Your main duties must involve practising, studying, teaching, or advancing religious beliefs. Your accommodation must be an important part of doing your job.

This rule doesn’t apply to members of religious societies or orders covered by section CW 25.

If you only have the accommodation for part of the year, the rule only applies to that part of the year.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM6439717.

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Money and consumer rights > Taxes
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Part C Income
Employee or contractor income

CE 1EException: accommodation provided to ministers of religion

  1. Despite section CE 1B(1) and to the extent described in subsection (2), the value of accommodation that is provided to a person who is a minister of religion is income of the person when the property in which the accommodation is provided is supplied by the religious society or organisation of which they are a minister.

  2. The amount of income for an income year is calculated using the formula—

    remuneration × (1 − adjustment) + excess rental.

    Where:

    • In the formula,—

    • remuneration is the amount that equals 10% of the remuneration that the person receives for the income year for the performance of their duties as a minister from the religious society or organisation of which they are a minister:
      1. adjustment is the adjustment referred to in subsection (4), and is the part of the amount that is the value of the accommodation for the income year apportioned to work-related use, expressed as a decimal fraction of the total value of the accommodation:
        1. excess rental is the amount that is not less than zero that is the difference between—
          1. the market rental value for the income year of the accommodation provided; and
            1. the market rental value for the income year of accommodation that is reasonably commensurate with the duties of the person as a minister and for the location in which they perform their duties.

            2. For the purposes of subsection (3)(a), the calculation of the amount of the item remuneration excludes the value of accommodation described in subsection (1) that is provided to the person.

            3. An adjustment referred to in subsection (3)(b) is as follows:

            4. if the person to whom the accommodation is provided uses part of the accommodation wholly or mainly for work purposes related to their duties as a minister, the amount is apportioned between that business use and private use:
              1. if more than 1 person referred to in subsection (1) shares in the accommodation provided, the amount is apportioned equally between them.

                1. For the purposes of this section, if accommodation is provided for part of an income year, the reference to income year is read as a reference to the relevant part of the income year.

                2. For the purposes of this section, minister of religion—

                3. means a person—
                  1. who is ordained, commissioned, appointed, or otherwise holds an office or position, regardless of their title or designation, as a minister of a religious denomination or community that meets the charitable purpose of the advancement of religion; and
                    1. whose duties are related mainly to the practice, study, teaching, or advancement of religious beliefs; and
                      1. whose accommodation is used as an integral part of performing their duties:
                      2. does not include a member of a religious society or order referred to in section CW 25 (Value of board for religious society members).

                        Notes
                        • Section CE 1E: inserted, on , by section 15 of the Taxation (Annual Rates, Employee Allowances, and Remedial Matters) Act 2014 (2014 No 39).
                        • Section CE 1E(3B) heading: inserted (with effect on 1 April 2015), on , by section 77 of the Taxation (Annual Rates for 2015–16, Research and Development, and Remedial Matters) Act 2016 (2016 No 1).
                        • Section CE 1E(3B): inserted (with effect on 1 April 2015), on , by section 77 of the Taxation (Annual Rates for 2015–16, Research and Development, and Remedial Matters) Act 2016 (2016 No 1).