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IR consulting on taxing employer-provided travel

Inland Revenue has put out proposals for consultation to clarify and simplify the tax rules around employer-provided travel to distant workplaces - for example, a person who works in Wellington but lives in Auckland, or who may travel greater distances in working from home or at multiple workplaces.

The proposals seek to make it easier to tell when this kind of employer-provided travel is exempt from income tax (PAYE) or fringe benefit tax (FBT). The proposals also make clear when home is a legitimate workplace for employer-provided travel purposes, and when an employment arrangement is regarded as temporary – that is, less than two years.

In putting the proposals out for consultation, Inland Revenue said it was aware that employers and employees were uncertain about when employer-provided travel to a distant workplace was subject to tax. And some employers had been treating all employer-provided travel to a distant workplace as not taxable.

So the proposals out for consultation address that uncertainty by setting out Inland Revenue’s approach to determining whether employer-provided travel to a distant workplace is exempt or not.

The consultation period closes on Friday 6 September. The consultation document can be found at