Accommodation allowances
Accommodation payments
If you’re a contractor or entertainer and you work in the screen production industry, you may get an accommodation payment. These payments are sometimes called an accommodation allowance.
They are part of your gross income and usually taxed. If you have to file an income tax return, you need to include the payments in your return.
Accommodation expenditure
You usually cannot deduct accommodation expenses because they are part of your private living costs. In limited cases, they can be deductible if you have to work away from where you normally live for a short time, usually 3 months or less.
There may be other times you can claim accommodation expenses. However, unless it’s for 3 months or less, we may ask you for more information to support your claim. This information should show how the expenses relate to the costs of earning your income as opposed to being private living costs.
You’ll need to keep all your invoices and receipts to support any expenses you claim against your taxes.
Other allowances
If you are an employee, you may receive allowances other than those mentioned above.
Per diems
Some contractors or entertainers working in the screen production industry, receive per diem (per day) payments in addition to payment for their services.
Per diems are payments you receive to cover the cost of meals and other minor expenses (such as laundry or phone calls) you may have when you are required to work away from your town or country of normal residence.
They are part of your gross (total before tax) income and are subject to tax on schedular payments. If you are required to file an income tax return, you need to include per diems as part of your income on the return.
You can claim tax deductions for such work-related expenses against your end-of-year tax. These are called allowable deductions. To claim deductions, you have to file a tax return. You'll need to keep your invoices and receipts to support any tax deductions you claim.
On 1 July 2018 Inland Revenue updated an expenditure determination about people working in the screen production industry. Where you are required to work away from home and you incur expenses relating to your work and you receive per diems, the determination will apply to you.
The determination allows that from 1 July 2018, people working in the screen production industry are able to receive up to NZ$80 per day in per diem allowances without having schedular payment deducted. If you receive $80 or less in per diems a day, you won't need to keep your invoices and receipts for income tax purposes.
Per diem payments of more than $80 per day will need to have tax on schedular payments deducted by the payer on the amount over $80 (eg, if $90 is paid, schedular payments must be deducted from $10 of the payment). If you wish to claim per diem related expenditure greater than $80 for any day, you will need to keep all of your receipts in respect of that day.
If you receive a per diem payment but some goods or services for which the per diem is paid (eg meals) are provided, the $80 tax on schedular payments exemption is reduced. See the examples in the accordian.
If all your costs are met by the screen production company, the $80 exemption does not apply. Tax on schedular payments must be deducted from the full amount of any per diem payment you receive. You'll need to include any per diem received as gross (total before tax) income in your income tax return. As all costs are met by the screen production company, there will be no allowable deductions.
If your expenses amount to more than the per diem payment received, and you want to claim a deduction for the amount in excess of the per diem, you must keep receipts and invoices for all the expenses claimed for that particular day.
GST returns
To complete your GST returns, you'll need to keep all your receipts and invoices regardless of how much you receive in per diems. Also, per diems are paid exclusive of GST, so when you prepare your GST invoice, you will need to calculate GST on the per diems received.
Production companies
If you have a production where you will be paying a per diem of more than $80 and you can justify a higher amount, you can apply for a specific determination relating to that particular production.
You receive a per diem allowance of $80 while required to work away from your town of normal residence. You pay for the cost of the goods and services for which the allowance is paid. The payer does not have to deduct tax on schedular payments because the total payment does not exceed $80 per day.
You receive a per diem allowance of $80 and you are working in your town of normal residence. As you are working in your town of normal residence the determination does not apply. The payer has to deduct schedular payments from the per diem allowance of $80.
You receive a per diem allowance of $80. You are also provided with all meals while working, either on the set or at some other location. You haven't incurred the expense so the determination doesn't apply. The payer has to deduct tax on schedular payments from the per diem allowance of $80.
The payer provides you with goods and services to the value of $15 per day. Therefore the maximum amount you can be paid as a per diem without tax on schedular payments being deducted is $65 per day.
You receive a per diem allowance of $95. You pay the cost of the goods and services for which the allowance is paid. The payer has to deduct tax on schedular payments from $15 of each daily payment as the payment exceeds the $80 threshold on a daily basis.