Edited version of your written advice

Authorisation Number: 1012927349540

Date of advice: 17 December 2015

Ruling

Subject: Work related travel expenses

Question 1

Are you entitled to a deduction for your motor vehicle expenses to travel between your home and your first worksite for a shift?

Answer

No.

Question 2

Are you entitled to a deduction for travel expenses you incurred when travelling between different worksites in the one shift?

Answer

Yes.

This ruling applies for the following period:

Year ending 30 June 2015

The scheme commences on:

1 July 2014

Relevant facts and circumstances

You are employed.

You work split shifts daily.

You work at numerous sites throughout the city.

You receive a roster of your shifts and do not have a permanent base of work.

You are not provided with a locker.

Different sites require different means of transport either by car, train or bus.

You often attend different sites on the same day.

You regularly commence work at one site and then move to another to meet staffing requirements. This is at your own expense.

Your employer does not pay you an allowance or reimburse you for travel expenses.

If you are required at another site during your shift you are required to travel to and from that place.

You are not required to carry equipment from site to site for work, but if you work at an event (concert, festival) you are required to collect and transport equipment.

When you are required to work at sporting events and festivals you have to travel to the office (one hour each way) to collect your equipment which is less than 20kgs.

You are occasionally required to travel over one hour to the business office between shifts for training, meetings and to retrieve stock.

You do not want to claim home to work and work to home travel, just the legs in between.

You have a record of every shift you have worked and what type of travel was involved.

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 a loss or outgoing to the extent to which it is incurred in gaining or producing assessable income, except where the loss or outgoing is of a capital, private or domestic nature, or relates to the earning of exempt income.

Travel between home and work

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 (Lunney v. Federal Commissioner of Taxation (1958) 100 CLR 478; 11 ATD 404) (Taxation Ruling IT 112). 

The cost of travelling 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. Put at its simplest, travel to work is private; travel on work is business.

It should be noted that the mode of transport, the availability of transport, the lack of suitable public transport, the erratic times of employment, the time of travel, the distance of travel and the necessity of travel does not alter the essential character of travel between home and work as being private in nature.

However, a deduction for car expenses between home and work may be allowed if a person's job is itinerant.

Itinerancy

The question of whether an employee's work is itinerant is one of fact, to be determined according to individual circumstances. It is the nature of each individual's duties and not their occupation or industry that determines if they are engaged in itinerant work. Further, itinerant work may be a permanent or temporary feature of an employee's duties.

Taxation Ruling TR 95/34 provides guidelines for establishing whether an employee is carrying out itinerant work. The ruling states that the following characteristics are indicators of itinerancy:

1. travel is a fundamental part of the employee's work that is, a taxpayer is required to undertake several journeys between different workplaces per day to be able to perform his/her work (Federal Commissioner of Taxation v. Wiener 78 ATC 4006; (1978) 8 ATR 33) (Wiener's case).

2. there is a 'web' of work places in the taxpayer's regular employment. A web of workplaces will exist where the employee performs work at a single site and then moves to other sites on a regular basis as in Wiener's case. However the existence of a 'web' of work places will not exist if an employee performs work at more than one site and each site is regarded as a regular fixed place of employment. TR 95/34 states that if the teacher in Wiener's case had attended only one school each day instead of many, each school would be regarded as a regular place of employment.

3. The taxpayer continually travels from one work site to another. Continual travel refers to the frequency with which an employee moves from one work site to another. It envisages that the employee regularly works at more than one work site per day before returning to his or her usual place of residence. The nature of the taxpayer's employment arrangements, that is, whether they have one employer or several employers, is not sufficient to alter the character of the travel expenses.

4. other factors that may indicate itinerancy (to a lesser degree) include:

• the employee has a degree of uncertainty of location in his or her employment (that is, no long term plan and no regular pattern exists)

• the employee's home constitutes a base of operations

• the employee has to carry bulky equipment from home to different work sites

• the employer provides an allowance in recognition of the employee's need to travel continually between different work sites.

Whilst the above characteristics are not exhaustive, they provide guidelines for determining whether an employee's work is itinerant. It is considered that no single factor on its own is necessary decisive.

Your situation

Your case is similar to Wiener's case as we consider that travel is a fundamental part of your employment. You perform your duties at more than one location, so it can be considered that you have a web of work places and that continuous travel between work sites is a part of your regular duties. There is a degree of uncertainty, as you are regularly moved from one site to another to meet staffing requirements.

In view of the above, your employment is considered itinerant in nature as you travel to different locations to work on any given day. The expenses are incurred the performance of your duties.

Travel between two different work sites.

On the days after commencing your duties, where you are required to travel to a different work site it is considered you are travelling on work rather than to work. The travel is undertaken in the performance of your duties. Therefore where you finish work at one work site and travel directly to the next work site in order to continue your work with your employer, you will be entitled to claim a deduction for your travel expenses for this portion of your journey.

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