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ATO Interpretative Decision

ATO ID 2005/158 (Withdrawn)

Fringe Benefits Tax
Exempt Benefits: remote area housing and water

Attention This ATO ID is withdrawn. Guidance on the view contained in this ATO ID can be found in Fringe benefits tax - a guide for employers (QC 16123).
Attention This document has changed over time. View its history.
FOI status: may be released
Status of this decision: Decision withdrawn 25 January 2018.

CautionCAUTION: This is an edited and summarised record of a Tax Office decision. This record is not published as a form of advice. It is being made available for your inspection to meet FOI requirements, because it may be used by an officer in making another decision.

This ATOID provides you with the following level of protection:

If you reasonably apply this decision in good faith to your own circumstances (which are not materially different from those described in the decision), and the decision is later found to be incorrect you will not be liable to pay any penalty or interest. However, you will be required to pay any underpaid tax (or repay any over-claimed credit, grant or benefit), provided the time limits under the law allow it. If you do intend to apply this decision to your own circumstances, you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed. You may wish to obtain further advice from the Tax Office or from a professional adviser.


Where an employer provides an employee with a remote area housing benefit, that is an exempt benefit under section 58ZC of the Fringe Benefits Tax Assessment Act 1986 (FBTAA), will the provision of water as agreed under a residential tenancy agreement constitute part of the exempt benefit?


Yes. The provision of water to the employee as agreed under a residential tenancy agreement is part of the remote area housing benefit which is exempt under section 58ZC of the FBTAA.


The employer provides housing to an employee.

The housing is provided to an employee in a remote area.

The employee signed a residential tenancy agreement with the employer.

Under a clause in the residential tenancy agreement the employer agreed to provide the employee with free water in connection with the accommodation provided to the employee as part of the agreement.

Reasons for Decision

Section 58ZC of the FBTAA provides that a housing benefit that is a remote area housing benefit is an exempt benefit.

Section 25 of the FBTAA provides that a 'housing benefit' arises where a 'housing right' is granted by one person to another person.

A 'housing right' is in turn defined in subsection 136(1) of the FBTAA as:

   in relation to a person, means a lease or licence granted to the person to occupy or use a unit of accommodation, insofar as that lease or licence subsists at a time when the unit of accommodation is the person's usual place of residence.

Where water is provided to an employee in accordance with a residential tenancy agreement between the employer and the employee, the water will form part of the 'housing right' that is granted under the same agreement.

Unlike electricity or gas, water is not 'residential fuel' as defined under subsection 136(1) of the FBTAA. As such section 59 of the FBTAA does not apply to the provision of water.

Accordingly, the provision of water to the employee is part of the remote area housing benefit which is exempt under section 58ZC of the FBTAA.

Date of decision: 9 June 2005

Year of income:Year ended 31 March 2006

Legislative References:
Fringe Benefits Tax Assessment Act 1986
   section 25
   section 58ZC
   section 59
   subsection 136(1)

Related ATO Interpretative Decisions
ATO ID 2004/276

FBT exempt housing benefit
FBT remote area housing
Fringe benefits tax
Housing fringe benefits

Siebel/TDMS Reference Number: 4602006; 1-5T2LZ47; 1-CP0GHSU

Business Line: Private Groups and High Wealth Individuals

Date of publication: 10 June 2005
Date reviewed: 8 December 2014

ISSN: 1445-2782

ATO ID 2005/158 (Withdrawn) history   Top  
   Date   Version 
    9 June 2005   Original statement   
 You are here ®  25 January 2018   Withdrawn   


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