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Employer responsibilities Ngā kaiwhakawhiwhi mahi takohanga

Meal and clothing allowances (specific rules and tax exemptions)

Meal and clothing allowances/payments may be exempt from tax. Find out more about:

Meal allowances 

Employers typically meet an employee's meal costs when link to work-related duties to recognise that these meals may be more expensive for the employee than normal meal costs at home.

There are two specific exemptions:

  1. An exemption applies of up to three months for meal payments if the employee is required to work away from their normal work location because they're travelling on business. This may be for a specific short-term, work-related journey or for a longer period such as a secondment to a distant work location.
  2. Payments to cover working meals and light refreshments when working off the employer's premises are exempt without any upper time limit.

In both situations, when the exemption applies, the full amount of any meal payment will be exempt. The exemption includes reimbursement payments and meal allowances.


These rules don't affect the existing exemptions that apply to overtime meal payments and sustenance allowances. The rules also don't apply in the case where fringe benefit tax (FBT) is payable on meals directly provided by the employer such as a discount in the work canteen. The rules that limit employers' deductions of entertainment expenses also continue to apply.

Calculating the three-month time limit

The three-month time limit runs from the date the employee starts working at the workplace and extends for as long as the employee works continuously at that location.


Vernon normally works in Christchurch but is sent by his employer to work in the Nelson office for a period of six months. Vernon's employer pays him a meal allowance for the duration of the secondment. The meal allowance is exempt for the first three months and taxable for the remainder of the secondment.

If the employee is sent away from their normal workplace and doesn't have a fixed work base while they're away, but instead works at a variety of locations and out of an accommodation base (a single accommodation location away from their normal residence, from which they travel to the various workplaces), then the time limit will apply from the date at which they arrive at the accommodation base.


Bruce normally lives in Napier. He is sent by his employer to work on an infrastructure project that requires him to work in a variety of locations around the Waikato. Rather than moving to each location, Bruce rents a house to use as a base from which he can travel to those locations each day as required. The three-month time limit applies from the date Bruce moves to the rented accommodation.

When deciding if the employee is working continuously at a particular location, periods they're away from the location for personal reasons such as:

  • leave
  • weekend breaks, and
  • short breaks that are required for work purposes

will be disregarded.

Payments to cover meal expenses for a working meal near the employee's work location will be exempt in certain circumstances. For example, lunches at conferences or training courses near their normal work location. The expense will only be exempt if the employee attends the meal because of the nature of the duties of the job.

Working meals and light refreshments 

A tax exemption may also apply for payments for light refreshments (in the form of snack food such as biscuits and fruit, or liquid refreshments such as tea or coffee), when the following criteria are met:

  • the employee's duties mean they're away from their work premises for most of the day
  • the employer would normally provide the refreshments to the employee on the day, and
  • it isn't practicable for the employer to provide the refreshments on the day.

Jane normally works in an office where her employer provides tea and coffee for employees while working. Jane is required to spend two days out of the office staffing a recruitment stand for her employer at a local employment expo. During her attendance at the expo, it isn't practical for Jane's employer to provide her with tea or coffee. A payment made by Jane's employer to cover tea or coffee in these circumstances will be exempt.

Clothing payments 

There are two types of clothing payments that will be exempt from tax. They are payments:

  • provided to cover the cost of distinctive work clothing, eg, uniforms, and
  • to meet the costs of plain clothes allowances paid to members of a uniformed service, provided certain conditions are met.

"Distinctive work clothing" is defined as meaning a single item of clothing, that:

  • is worn by an employee as, or as part of, a uniform that can be identified with the employer:
    • through the permanent and prominent display of a name, logo or other identification that the employer regularly uses in carrying on their activity or undertaking, or
    • because of the colour scheme, pattern or style is readily associated with the employer
  • is worn in the course of, or as an incident of, employment, and
  • isn't clothing that employees would normally wear for private purposes.

Distinctive clothing therefore only includes uniforms or specialist clothing that isn't reasonably suitable for private use and is necessary and peculiar to a particular occupation.

This would include uniforms worn by nursing staff, members of the armed forces and police officers. Specialist clothing might include overalls and protective clothing worn for health and safety reasons.

Uniformed service workers, ie, police officers that meet specific conditions, may be entitled to an exemption for plain clothes allowances that were put in place on 1 July 2013. To find out more about the plain clothes allowance read our Special report on employee allowances on our Tax Policy website.