Living away from home allowances (LAFHA)

LAFHA can take various forms:
• An allowance the payment to you by your employer.
• Direct provision of a benefit from your employer.
• Compensation of expenses which you incur by your employer.
LAFHA’s intended to compensate you for expenses acquired whilst you are working away on Secondment. Living away from home allowance are payable in situations where you have carried on to live in your home, but the requirement to change apartment in order to work temporarily in another area at your employers bequest. A LAFHA paid to your income tax free and should not be included as measurable income on your tax return. LAFHA are often confused with travel allowances. The travel allowances are paid to employees who are travelling on business, but not living away from the house. Mainly, an employee travelling for business for less than 21 Days will receive the travel allowance, not a LAFHA. You can receive a LAFHA who also live away with you, including your wife and your children.
Keeping records of Expenses:
You must keep records of your expenses and will need to give your employe either:
• A declaration setting out information about the expense.
• Documentary evidence of the expense such as credit card, receipts.