Income Tax Act 2007

Income - Exempt income

CW 16B: Accommodation expenditure: out-of-town secondments and projects

You could also call this:

"When your job takes you away from home, your employer can pay for your accommodation without you paying tax on it"

When you work at a distant workplace on a project or secondment, your employer might pay for your accommodation. This can happen when your job requires you to work away from home for a limited time. Your employer can pay for your accommodation or give you money to help with accommodation costs.

If your employer pays for your accommodation, you do not have to pay tax on this money. This rule applies when you have to work at a distant workplace for your job and you stay there for one or more nights. You can find more information about time limits in section CW 16C.

A distant workplace is a workplace that is far from your home, so you cannot travel to it every day. An out-of-town secondment is when you are sent to work at a distant workplace for a limited time, usually no more than two years. A project of limited duration is a specific work project that has a clear start and end date and is expected to last no more than three years. Your employer can estimate how much they will spend on your accommodation and this estimated amount is used for tax purposes. You can also find more information about accommodation expenditure in sections CW 16C to CW 16F, CW 17CB, CZ 29 to CZ 30, and FP 22.

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CW 16C: Time periods for certain accommodation expenditure, or

"Rules for getting help with accommodation costs when you work away from home"

Part CIncome
Exempt income

CW 16BAccommodation expenditure: out-of-town secondments and projects

  1. This section applies when—

  2. the employment duties of an employee require them to work at a distant workplace on an out-of town secondment or a project of limited duration; and
    1. the period of the employee's employment or service at the distant workplace is a period of continuous work; and
      1. the employer—
        1. provides accommodation for the employee for a period that falls within a time limit described in section CW 16C:
          1. incurs expenditure on the employee's accommodation at the distant workplace for a period that falls within a time limit described in section CW 16C:
            1. incurs expenditure on the employee's accommodation for necessary travel to and from the distant workplace in connection with the performance of their duties.
            2. This section does not apply—

            3. to an amount that is the value provided or expenditure incurred by the employer when, under the terms of the their employment, the employee would be entitled to a greater amount of employment income, should the employee choose, or have chosen, not to receive the benefit of the amount:
              1. in relation to an out-of-town secondment, to a new employee of the employer.
                1. The amount that is the value provided or expenditure incurred by the employer is exempt income of the employee.

                2. For the purposes of subsection (1)(c)(ii),—

                3. an employer may make, for a relevant period, a reasonable estimate of the amount of expenditure likely to be incurred on an employee's accommodation; and
                  1. the amount estimated is treated as if it were the amount incurred during the period to which the estimate relates.
                    1. In this section and sections CW 16C to CW 16F, CW 17CB, CZ 29 to CZ 30, and FP 22 (which relate to accommodation expenditure), as applicable,—

                      distant workplace, for an employee, means a workplace that—

                      1. is another workplace of the employee; and
                        1. is not within reasonable daily travelling distance of their residence

                          out-of-town secondment means the placement of an employee at a distant workplace—

                          1. because the employment duties of the employee require them to work at the distant workplace for the performance of those duties; and
                            1. for a period that, in their employer's expectation at the start of the period of secondment, will last for no more than 2 years

                              period of continuous work

                              1. means a period when an employee has ongoing duties of employment that must be performed to a significant extent at a distant workplace, requiring the employee to stay at the distant location for 1 or more nights; and
                                1. includes the employee's time away on leave or other breaks for personal reasons, weekend breaks, required rest periods, and other similar periods

                                  project of limited duration means a particular work project—

                                  1. whose principal purpose is to create, build, develop, restore, replace, or demolish a capital asset; and
                                    1. which is carried out under a contract between an employer (the contractor) and 1 or more persons who are not associated with the contractor; and
                                      1. in relation to which the engagement of an employee of the contractor at the distant workplace—
                                        1. has, at the outset, clear start and end dates; and
                                          1. involves work that, apart from incidental activities, is undertaken solely for the purposes of the project; and
                                            1. in the contractor’s expectation at the start of the project, will last for a period of no more than 3 years

                                            workplace means a particular place or base—

                                            1. at which an employee performs their employment duties; or
                                              1. from which an employee's duties are allocated.
                                                Notes
                                                • Section CW 16B: inserted, on (applying for the 2015–16 and later income years), by section 24(1) of the Taxation (Annual Rates, Employee Allowances, and Remedial Matters) Act 2014 (2014 No 39).
                                                • Section CW 16B(5): amended, on , by section 22 of the Taxation (Annual Rates for 2024–25, Emergency Response, and Remedial Measures) Act 2025 (2025 No 9).
                                                • Section CW 16B(5) project of limited duration paragraph (b): replaced (with effect on 1 April 2015), on , by section 83 of the Taxation (Annual Rates for 2015–16, Research and Development, and Remedial Matters) Act 2016 (2016 No 1).
                                                • Section CW 16B(5) project of limited duration paragraph (c): replaced (with effect on 1 April 2015), on , by section 83 of the Taxation (Annual Rates for 2015–16, Research and Development, and Remedial Matters) Act 2016 (2016 No 1).