Expat Housing & Travel Allowance Tax Rules

One perk of expat life is a housing allowance or travel support, but don’t assume these are tax-free.

 

• • Australia (ATO): Most allowances (housing, relocation, cost of living) are considered taxable fringe benefits unless they fall under specific exemptions. Employers may pay Fringe Benefits Tax (FBT) instead of you. ATO – Fringe Benefits Tax

• • Canada (CRA): Relocation allowances and housing support are usually taxable benefits included in your T4 slip. Limited exemptions apply (e.g., moving within Canada > 40km closer to work). CRA – Benefits & Allowances

• • U.S. (IRS): Most employer-provided housing and travel allowances are taxable as income, unless very specific exclusions apply (e.g., housing provided for employer convenience on-site). IRS – Fringe Benefits
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What Expats Should Do

1. Check local tax law or employer policy for allowance classification.

2. Document each allowance: what it covers, duration, receipts.

3. If taxed in two countries, use tax treaties to claim credit or exemption.

4. Ask employer to gross-up the allowance so you don’t end up net negative.

5. Review benefits-in-kind rules in both home & host countries.

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Felix’s Quick Tips

• If you move frequently, ask for a housing adjustment clause that resets after relocation.

• Avoid “over-allowance” that raises red flags with tax auditors.

• Store all receipts, lease agreements, travel logs — auditors may ask years later.

• If you’re unsure, ask your tax advisor to simulate the tax effect before accepting the allowance.

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• An Australian expat → check the Australia Expat Tax Guide for superannuation rules.

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• A Canadian expat → see the Canada Expat Tax Guide for RRSP and TFSA rules.

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• For more insights, browse the full Expat Tax Tips & Insights.