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Ruling

Subject: Travel expenses

Question

Are you entitled to a deduction for your home to work travel?

Answer

No.

This ruling applies for the following periods:

Year ended 30 June 2012

Year ended 30 June 2013

Year ended 30 June 2014

Year ended 30 June 2015

Year ended 30 June 2016

The scheme commenced on:

1 July 2011

Relevant facts and circumstances

You are employed at a mining site in City A.

You live in City B and travel from your home to City A every second week to complete your employment duties.

You are required to vacate the living quarters at the end of each shift and must remove all belongings taken by you to the mine site.

You are required to take to the mine site the following items of equipment and apparel:

· supplied uniforms, which includes seven sets of long sleeve high visibility shirts and seven sets of trousers

· at least one pair of steel capped boots

· a work bag to carry one safety mine site helmet, two pairs of safety glasses, a quantity of safety earplugs, a small number of hand tools, a work diary, a supply of job hazard analysis forms and a quantity of padlocks necessary to lock up and isolate a haul truck as and when required.

You transport the uniforms and equipment to the mine site in a suitcase on wheels and the contents and the case normally weigh approximately 20 kilograms.

You do not take any other personal items or clothing in the work bag.

You incur costs flying between City B and City C airports, driving between your home and rail station A and the cost of rail tickets between rail station A and rail station B.

Your do not incur any expenses travelling between City C and the mine site.

Relevant legislative provisions

Income Tax Assessment Act 1997 Section 8-1

Reasons for decision

Summary

The costs you have incurred are as a consequence of living in one place and working in another and were incurred to enable you to commence, or return home after completing your income earning activities and are considered private in nature and are not deductible.

Detailed reasoning

Section 8-1 of the Income Tax Assessment Act 1997 allows a deduction for all losses and outgoings to the extent to which they are incurred in gaining or producing assessable income except where the outgoings are of a capital, private or domestic nature.

A deduction is generally not allowable for the cost of travel by an employee between home and their normal workplace as it is considered to be a private expense. The cost of travel between home and work is generally incurred to put the employee in a position to perform duties of employment, rather than in the performance of those duties (see paragraph 77 of Taxation Ruling TR 95/34).

However, there are situations where it has been accepted that travel by employees from home to work is deductible. These situations include:

· where the employment can be construed as having commenced at the time of leaving home, for example a doctor on call,

· where you travel between home and shifting places of work, that is, an itinerant occupation, and

· the transportation of bulky equipment in some circumstances.

In your situation, your work has not commenced before leaving home and you are not considered itinerant. You do carry some work equipment while travelling, therefore the issue of bulky equipment will be addressed further. The question of what constitutes bulky equipment is a question of fact and must be considered according to the individual circumstances of each case.

The question of what constitutes bulky equipment was considered in Crestani v. Federal Commissioner of Taxation 98 ATC 2219; (1998) 40 ATR 1037 (Crestani's case). In that case, the toolbox in question measured 56cm x 25cm x 28cm and weighed approximately 27kg. The Administrative Appeals Tribunal (AAT) in that case decided that the toolbox was sufficiently cumbersome to be considered bulky. The opinion of the AAT was the toolbox was not easy to lift and could not be carried for any distance and that public transport was not a viable option.

In Case 43/94 94 ATC 387; AAT Case 9654 (1994) 29 ATR 1031 a flight sergeant with the Royal Australian Air Force was denied a deduction for the cost of transporting his flying suit and other items used for work purposes. The items were carried in:

· a duffle bag measuring 75cm long x 55cm wide x 50cm deep and weighing 20 kilograms when packed

· a suit bag which weighed 10 kilograms when packed, and

· a briefcase sized navigational bag which contained charts, work manuals and study materials.

It was held that the travel was private in nature and the items were not sufficiently bulky to impede easy transport. It was held that the mode of transporting the duffle bag, the navigational bag and the suit bag was simply a consequence of the means adopted in conveying himself to and from his place of employment.

In your situation, you take various items of equipment and apparel with you when travelling between home and work. We consider the tools you carry are not sufficiently cumbersome or heavy to be considered bulky. Based on the decisions in Crestani's case and Case 43/94 your tools are not considered to be of a size or weight that would make their transportation difficult.

Therefore, your tools are not considered to be of such bulk that it would change the primary purpose of your journey from one of transporting yourself to and from work to one of transporting the tools. Consequently you are not entitled to a deduction.

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