A living away from home allowance is a payment made by an employer to an employee who due to work commitments is living away from their usual residence.
A living away from home allowance pays for expenses such as accommodation and meals while working away from your usual place of residence for extended periods. Generally, an employee is considered to be living away from home when an employee occupies a temporary residence for greater than 21 days.
A living away from home allowance is income tax free and is not declared as assessable income in a tax return. Conversely there is no tax deduction available for expenses that have been covered by a living away from home allowance.
A living away from home allowance is a fringe benefit that is paid by the employer, not the employee.
As a living away from home allowance is administered by the employer as opposed to the Australian Tax Office, living away from home allowances a generally provided on a timetable set by the employer. Generally, a living from home allowance is deposited into the employee’s bank account at the same time as normal pay.
In receiving a living away from home allowance, it is advisable to retain and to give to an employer a record of expenses incurred such as receipts, credit card or bank statements and a declaration setting out information about the expense.
Disclaimer: Prepared by Leigh Barker West Pennant Hills, MWC Group, Accountant, Portfolio Finance, Gordon and Tangible Assets. Note that all content of this blog is general in nature and is not financial or investment advice thus anyone intending to apply the information to practical circumstances should seek professional advice to independently verify their interpretation and the information’s applicability to their particular circumstance.
An auditor is an independent person or company appointed to check and verify the accuracy of financial records. An auditor may be an external auditor who examines the financial records and business transactions of an entity in which there is no affiliation or an internal auditor responsible for providing independent and objective evaluations of an entities financial and operational activities.
External auditors are engaged to express an opinion that the financial statements of an entity are free from material misstatements. An external auditor will communicate to management and staff to obtain a detailed understanding of an entity, of the operations of the entity, financial reporting and internal control procedures.
External auditors conduct the audit in accordance with specified audit guidelines and the users of an entities financial statements rely upon the external auditor to present an unbiased and independent audit report.
Internal auditors while employed by the organisation they audit bring a systematic and disciplined approach in evaluating financial and business activities inclusive of the effectiveness of risk management, control and corporate governance. Internal auditors report to management on how to improve the overall structure and business practices of an entity.
Internal auditors are not responsible for implementing the activities of an entity. The role of an internal auditor is to advise the Board of Directors how to better implement their responsibilities. An internal audit report will summarise the findings, recommendations and generally contains an action plan for management to implement.
Please note: Prepared by Leigh Barker Accountant at MWC Group, Tangible Assets, Portfolio Finance, Gordon and West Pennant Hills. Note that all content of this blog is general in nature and anyone intending to apply the information to practical circumstances should seek professional advice to independently verify their interpretation and the information’s applicability to their particular circumstance.