Zone Tax Offset to exclude “fly-in fly-out” and “drive-in drive-out” workers

The government will exclude “fly-in fly-out” and “drive-in and drive-out” workers from the Zone Tax Offset (ZTO) where their normal residence in not located within a “zone”. This will come into effect from the 1 July 2015.

The ZTO is a concessional tax offset that is available to individuals for living in areas of isolation, uncongenial climate and high cost of living which is associated with living in these identified locations.Eligibility is based on the defined geographic zones.

Currently to be eligible for the ZTO, a taxpayer must reside or work in a specified remote area for more than 183 days in an income year. According to the government, approx 20% of all claimants do not actually live full-time in these zones. Many of the claimants are “fly-in fly-out” workers who do not face the same challenges of remote living that the ZTO was designed to address.

Where “fly-in fly-out” workers normal residence is one zone, but working a different zone, will retain the ZTO entitlement associated with their normal place of residence.