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Income Tax Act 2007

Income - Exempt income

CW 16C: Time periods for certain accommodation expenditure

You could also call this:

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

If you are an employee sent to work in a different town, you might get some money to help with accommodation. The rules for this money are in section CW 16B. These rules apply for a certain time period.

When you start working in the new town, the time period starts. It ends when one of the following things happens: you have been there for 2 years, your work in the new town finishes, you get a payment to help you buy a new home under section CW 17B, or your employer thinks you will be there for more than 2 years.

If you are working on a project that will only last for a certain time, the rules are a bit different. The time period starts when you begin work on the project and ends when one of the following things happens: you have been working on the project for 3 years, your work on the project finishes, you get a payment to help you buy a new home under section CW 17B, or your employer thinks you will be working on the project for more than 3 years.

Sometimes, your employer might think you will be working in the new town for a long time, but then they change their mind. If this happens, the rules might still apply to you. You can find out more about this in section CW 16B.

If something unexpected happens, like a natural disaster, you might need to stay in the new town for longer than planned. In this case, the time limit might not apply. But you can only stay for as long as you need to because of the unexpected event.

If you take a break from working in the new town, it might not affect the time period. This is because the rules ignore breaks that are only taken so you can get an exemption under section CW 16B, CZ 29, CZ 29B, or FP 22.

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

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

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Part C Income
Exempt income

CW 16CTime periods for certain accommodation expenditure

  1. Section CW 16B applies for an employee on an out-of-town secondment to the value provided or expenditure incurred for a period that starts on the date on which the employee begins to work at a distant workplace, and ends at the earliest of the following dates:

  2. the date that is 2 years from the date on which they began work at the distant workplace:
    1. the date on which the out-of-town secondment ends:
      1. the date on which the employee receives a relocation payment under section CW 17B in relation to the costs associated with settling the purchase of a new home:
        1. the date on which the employer's expectation regarding the length of the period changes, and the total period is expected to be more than 2 years.

          1. Section CW 16B applies for an employee on a project of limited duration to the value provided or expenditure incurred for a period that starts on the date on which the employee starts work at a distant workplace, and ends at the earliest of the following dates:

          2. the date that is 3 years from the date on which the employee began work on the project at the distant workplace:
            1. the date on which the employee's participation in the project at the distant workplace ends:
              1. the date on which the employee receives a relocation payment under section CW 17B in relation to the costs associated with settling the purchase of a new home:
                1. the date on which the employer's expectation regarding the employee's involvement in the project changes, and the total period of their involvement in the project is expected to be more than 3 years.

                  1. Subsection (4) applies for a placement of an employee at a distant workplace when—

                  2. the employment duties of the employee require them to work for a period of time at the distant workplace for the performance of those duties; and
                    1. the terms of the placement of the employee meet the requirements of an out-of-town secondment or project of limited duration, as applicable, other than the requirement related to the limitation on the length of the period for which the employee is to remain at the distant workplace; and
                      1. the expectation of their employer at the start of the period is that the duration of the secondment or project will exceed the applicable time limit; and
                        1. during the period, the employer revises their expectation of the period for the secondment or project, reducing its expected duration, and as a consequence, the requirements of an out-of-town secondment or project of limited duration, as applicable, are fully met.

                          1. Section CW 16B applies to the amount that is the value provided or expenditure incurred by the employer for the remainder of the period for which the employee is required to remain at the distant workplace under the out-of-town secondment or project of limited duration. For these purposes, the period starts on the date on which the employer revises their expectation, and ends at the earliest of the dates referred to in subsection (1)(a) to (d) or (2)(a) to (d), as applicable.

                          2. A time limit does not apply if exceptional circumstances arise beyond the control of the employer and employee that require the employee to remain at the distant workplace after the period expires. Examples are a natural disaster or medical emergency. However, an extension of time must be limited to the period for which the employee is unable, because of the exceptional circumstances, to leave the distant workplace.

                          3. For the purposes of determining whether a time limit under this section applies, a break in a period of continuous work at a distant workplace is ignored if a reason, that is more than incidental, for the cessation of the employment or service is to allow a further period of exemption under section CW 16B, CZ 29, CZ 29B, or FP 22 (which relate to accommodation expenditure).

                          Notes
                          • Section CW 16C: 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 16C(6): amended, on , by section 23 of the Taxation (Annual Rates for 2024–25, Emergency Response, and Remedial Measures) Act 2025 (2025 No 9).