Skip to main content
OS 23/01
Issued
03 May 2023

When employee allowances for additional transport costs for home to work travel are exempt from income tax

Section CW 18 of the Income Tax Act 2007 exempts from tax some allowances that an employee receives from their employer to reimburse additional transport costs arising from the employee’s travel from home to work.  This means that PAYE does not have to be deducted from the allowance. The purpose of this Statement is to clarify when this exemption applies and to help employers to determine the amount of tax payable.

Tax Information Bulletin - Vol 35 No 5, June 2023

Income Tax Act 2007, s CW 18