Income Tax Act 2007

Recharacterisation of certain transactions - Tax relief for emergencies - Optional rule for valuation of group assets

FP 21: Employee benefits for emergency: not fringe benefit

You could also call this:

"Help from your employer during an emergency is not a fringe benefit if it meets certain rules."

When you get a benefit from your employer because of an emergency, it is not a fringe benefit if it meets some conditions. You get the benefit to help you with the emergency, and it is given to you within 8 weeks of the emergency starting, as decided by regulations made under section 6J of the Tax Administration Act 1994. The benefit does not replace your normal pay and is available to all employees, not just the ones who have been working there for a long time.

If you get a benefit that would normally be a fringe benefit, but it is because of an emergency, your employer does not have to count it as a fringe benefit if they cannot estimate its value. If your employer can estimate the value of the benefit, it is not a fringe benefit if its total value is less than or equal to $5,000 minus any exempt income you got from your employer during the same period, as stated in section CW 19B(b).

You are treated the same as other employees when it comes to getting benefits because of an emergency, and your employer treats the benefit as not being a fringe benefit.

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This page was last updated on 20 May 2025

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FP 20: Certain amounts derived by employees during emergency events, or

"Money from your employer during an emergency might not be taxed"

FP 22: Accommodation expenditure incurred during emergency events, or

"Help with accommodation costs during emergency events"

Part FRecharacterisation of certain transactions
Tax relief for emergencies: Optional rule for valuation of group assets

FP 21Employee benefits for emergency: not fringe benefit

This section applies when an employee receives from an employer a benefit that—
would be a fringe benefit in the absence of this section; and
is for the purpose of the relief of employees from the adverse effects of an emergency event; and
is derived in the period of 8 weeks starting on the date the emergency event begins, as specified by regulations made under section 6J of the Tax Administration Act 1994; and
does not replace a PAYE income payment; and
does not depend on the seniority of the employee; and
if the employee is associated with the employer, is available to another employee who—
1. is not associated with the employer; and
2. is, or was immediately before an emergency event, in full-time employment with the employer; and
is treated by the employer as not being a fringe benefit.

Benefits satisfying subsection (1) that would, in the absence of this section, be fringe benefits having a value for the employee that the employer could estimate are not fringe benefits to the extent to which their total value as fringe benefits for the period would be less than or equal to the amount by which $5,000 exceeds the income that is—
exempt income under section CW 19B(b) (Certain amounts derived by employees during emergency events: exempt income); and
derived by the employee from the employer in the same period.

Benefits satisfying subsection (1) that would, in the absence of this section, be fringe benefits having a value for the employee that the employer could not estimate are not fringe benefits.

Notes

Section FP 21: inserted, on 1 April 2025, by section 65 of the Taxation (Annual Rates for 2024–25, Emergency Response, and Remedial Measures) Act 2025 (2025 No 9).