Private ruling: Zone tax offset
Published: August 2013
Ruling period: Year ended 30 June 2013 | Year ending 30 June 2014 | Year ending 30 June 2015 | Year ending 30 June 2016 | Year ending 30 June 2017 | Year ending 30 June 2018
Date scheme commenced: 1 July 2012

Ruling: Q1: Are you entitled to claim a zone tax offset where you spend more than one-half of the income year in remote area zones? | A1: Yes.

Relevant facts and circumstances: You fly to various mining locations. As part of your employment you are required to fly to various zone locations on a daily basis. You normally have a short stop over period of 30 minutes; however, there are times when you are required to stop all day at different mine sites. You do not maintain a home in any of the zone locations that you fly to. You were present in the remote area zones for more that 182 days during the financial year.

Relevant legislative provisions: Income Tax Assessment Act 1936 Subsection 79A(1) | Income Tax Assessment Act 1936 Subsection 79A(3B)

Reasons for decision: Summary: A zone tax offset is provided under subsection 79A (1) of the Income Tax Assessment Act 1936 (ITAA 1936) for individuals who reside or stay in certain areas which are subject to uncongenial climatic conditions, are isolated, or where the cost of living is high. These areas are classed as either zone A or zone B. There are also special areas within these zones. One of the tests for eligibility is that you were actually in the relevant area for more than one-half of the income year. In your case, you fly to various remote locations around Australia and you normally have a short stopover period of 30 minutes, however, there are times where you are required to stop there all day. Taxation Ruling TR 94/27 states that in determining whether a person has resided or actually been in the relevant area for the required number of days, we consider that, for the purposes of the residence test in subsection 79A(3B) of the ITAA 1936, the word 'day' includes any one or more parts of a calendar day. Therefore as long as you spend more than one-half of an income year in remote zone locations you will be eligible to claim the zone tax offset.