| Disclaimer This edited version has been archived due to the length of time since original publication. It should not be regarded as indicative of the ATO's current views. The law may have changed since original publication, and views in the edited version may also be affected by subsequent precedents and new approaches to the application of the law. You cannot rely on this record in your tax affairs. It is not binding and provides you with no protection (including from any underpaid tax, penalty or interest). In addition, this record is not an authority for the purposes of establishing a reasonably arguable position for you to apply to your own circumstances. For more information on the status of edited versions of private advice and reasons we publish them, see PS LA 2008/4. |
Edited version of your written advice
Authorisation Number: 1012779686323
Ruling
Subject: Work related expenses - health and fitness expenses
Question 1
Are expenses you incurred for sports Chiropractic visits, orthotic devices and general physical fitness considered allowable deductions?
Answer
No.
Question 2
Are expenses you incurred on sunscreen used when coaching sports, considered an allowable deduction where they can be substantiated?
Answer
Yes.
This ruling applies for the following periods:
Year ended 30 June 2014
The scheme commences on:
1 July 2013
Relevant facts and circumstances
You are employed as a sports coach.
You must maintain a high level of fitness to perform your income earning activity.
You incurred expenses attending a Chiropractor, obtaining orthotic devices and other general physical fitness expenses.
You incur the above expenses as a precaution to not inflict permanent damage to your body, especially the spine.
You also incur expenses for sunscreen which you use when coaching outdoors.
Relevant legislative provisions
Income Tax Assessment Act 1997 Section 8-1.
Reasons for decision
Section 8-1 of the Income Tax Assessment Act 1997 (ITAA 1997) allows a deduction for all losses and outgoings to the extent to which they are incurred in gaining or producing assessable income, except to the extent that they are outgoings of a capital, private or domestic nature, or relate to the earning of exempt income.
Chiropractic visits, orthotic devices and general physical fitness expenses
Generally fitness expenses such as the cost of a gym membership are considered to be private in nature and are therefore not deductible under section 8-1 of the ITAA 1997.
Taxation Ruling TR 95/17 deals with the deductibility of gymnasium membership fees for Australian Defence Force (ADF) members. Whilst you have also incurred chiropractic and orthotic device expenses, the principles discussed in this ruling also applied to those expenses.
TR 95/17 states that a deduction is generally not allowable for fitness expenses for ADF members as these expenses are considered to be private. However a deduction is allowable for these costs if the ADF member can demonstrate that their position requires them to maintain a level of fitness well above the ADF general standard. An example provided in the addendum to TR 95/17 refers to a member of the Special Air Services Regiment (SAS) who is paid to maintain the very highest level of fitness, and plainly differentiates between the level of fitness required of a SAS member and that of an ordinary infantryman.
Clearly this taxation ruling follows the principle that unless a taxpayer's normal duties require the very highest level of fitness, deductibility of expenses will be denied.
In your case, there is no doubt that your duties as a sports coach requires a certain level of fitness. However, we do not consider the level of fitness required in your case is of the very highest level, as required by an officer in the SAS.
Accordingly, expenses relating to the chiropractic visits, orthotic devices and other general fitness expenses is considered to be a private expense and therefore not allowable under section 8-1 of the ITAA 1997.
Sunscreen
In Morris and Ors v. Federal Commissioner of Taxation (2002) 50 ATR 104; 2002 ATC 4404; [2002] FCA 616 the Federal Court found that the cost of sunscreen, sunglasses and sunhats were deductible in certain circumstances where the worker was required as part of his duties to be exposed to the sun.
It is accepted that the duties of your job require you to be exposed to the sun. It is reasonable to expect that protection from sun's rays is required. Therefore, the work related portion of the cost of the sunscreen used to protect you from the sun when you are working is deductible, provided the expenses can be substantiated in accordance with the rules contained in Division 900 of the ITAA 1997.
Copyright notice
© Australian Taxation Office for the Commonwealth of Australia
You are free to copy, adapt, modify, transmit and distribute material on this website as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products).
