Post allowance is a non-taxable “cost-of-living” allowance granted to employees stationed at a post or foreign area where the cost of living, exclusive of quarter's costs, is substantially higher than in Washington, DC. Post allowance is a cost index percentage between the Washington, DC area and the assigned post, and is based upon the number of family members residing at the post, the employee's base salary, the cost index, and the current exchange rate. PAL amount may increase/decrease without any advance notice based on the exchange rate and adjustments to the cost index.
To receive Post Allowance, you must submit a completed SF-1190. Post Allowance should be requested upon movement from temporary quarters to permanent quarters, or if TQSA is not used, upon arrival at the overseas duty location. Post allowance is included in your normal biweekly pay.
Note: Locality pay is not authorized overseas. Locality pay will be discontinued on the date an employee enter the rolls of the foreign area activity. Locality pay is not to be used in setting pay in a foreign area.
COLA for Italy