Case U10

Members:
HP Stevens SM

Tribunal:
Administrative Appeals Tribunal

Decision date: 18 December 1986.

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H.P. Stevens (Senior Member)

The questions for decision in this application relate to claims made by a schoolteacher in respect of overseas travelling expenses of $2,842 and relief teacher expenses of $572 in her return of income for the year ended 30 June 1983 in terms of sec. 51(1).

Overseas Travelling

2. From about 1969 the applicant was a "full time" part time teacher at a private school located in a country centre. She was full time in the sense that she was engaged year by year to teach a certain number of periods per week and was paid on the basis of the appropriate proportion of the award salary that would have been paid to a full time graduate assistant teacher. In the year in question she received two-thirds of the highest scale rate. The position above would be a head of a department (or co-ordinator) but the school was too small for such a position in her specialties. She was involved in relation to syllabus requirements and changes and had come on behalf of the school to Sydney to talk to various people in relation thereto. Proposed changes were abandoned when in a year subsequent to the year of income concerned the school was amalgamated with another school. She then became for the first time a full time teacher.

3. In 1982 the applicant became aware of a study tour for ancient history teachers organised by the Macquarie University faculty. She decided to go as this was the best way to obtain otherwise unavailable resources such as local museum publications and lessons can be made more interesting if one has personally seen the places being discussed. The main tour left Sydney on Saturday 18 December returning from Rhodes via Athens and arriving Sydney on Thursday 20 January 1983 but there was the option of proceeding from Rhodes on 17 January to Crete and then to Egypt arriving back in Sydney on Saturday 30 January. It was not necessary to leave with the group (must return as a group) and the applicant left on New Year's Day for Rome and joined the group later for the Crete and Egypt sections. The tour cost $2,842 of which the air fare component was $2,177. The applicant was not accompanied on the tour by her husband.

4. The applicant did not receive any additional salary at the school as a result of the trip nor was she promised any by the authorities. Apparently there were some marital difficulties and the applicant was considering moving to Sydney. She later applied for two advertised positions at other schools in Sydney and obtained a position as head teacher at one for the 1985 teaching year - her husband

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remaining at the country centre. The applicant felt the tour would have been a factor in gaining this new appointment.

5. For the applicant her representative conceded that the majority of teachers' overseas travelling expenses had been disallowed because generally there was no sufficient nexus with assessable income. However he thought the evidence was strong enough in the present case because, inter alia, it was directly responsible for the applicant obtaining her new position with a different employer. For the Commissioner it was submitted that the situation was no different to other teacher cases which had been disallowed and the subsequent position being with another employer did not alter this situation. Reference was made particularly to
F.C. of T. v. Finn (1961) 106 C.L.R. 60;
F.C. of T. v. Hatchett 71 ATC 4184; (1971) 125 C.L.R. 494 and
F.C. of T. v. Klan 85 ATC 4060.

6. The Tribunal agrees with the views of the Commissioner's representative. In Case R73,
84 ATC 509 the Chairman analysed the various authorities (including Finn and Hatchett) and at p. 513 said:

"15. This consideration of some of the subsequent cases reinforces my view that the `purity' of Finn is to be found in the attitude of mind of Dixon C.J. It is not to be found in the extraction of a general principle that all professionals are entitled to a deduction in respect of the `costs of keeping up to date' (for Dixon C.J. went out of his way not to so find) but rather in the reminder that it is the words of the section (and not a statement of broad propositions) that are determinative in relation to the particular facts of a case. The Full Federal Court's recent decision in
Martin v. F.C. of T. 84 ATC 4513 adds further support to this view."

He then dealt with the facts of that case and at p. 514 found:

"18. Looking at the above it is apparent to me that a `master teacher' is in a very different situation to `normal' teachers in that she has a responsibility not just to her classroom pupils but also to her fellow teachers who have, in effect, `elected' her to that position. She has, in a real sense, a role of being a resource person (in her field) for others in the education system and, accordingly, has an ongoing need to keep abreast of trends, etc. in order to fulfil that role. If she could not continue to satisfy what is required of her she would not be carrying out an essential part of the `duties' or activities of her position as a `master teacher' and the steps taken by her to keep herself abreast can be seen as an integral part of the functions of her position.

19. In the circumstances I think the facts of this special case are such that it is open to find (subject to looking at individual items) that the expenditure at issue was incurred in gaining or producing the taxpayer's assessable income and I so find."

7. Adopting the above the Tribunal is unable to see the applicant as other than a "normal" teacher. In so far as reliance is placed upon the obtaining of a new position Ormiston J. in Klan's case (supra) said at p. 4067 "there is a difference of fundamental importance between obtaining a new appointment and seeking preferment to a higher or different, but better paid, position with the same employer" and this would not justify allowance. Accordingly the Tribunal affirms the decision of the Commissioner in relation to this claim.

Relief Teacher

8. The factual position here is that the applicant desired appointment as a marker of Higher School Certificate papers the duties in relation to which had to be carried out in Sydney. She sought the approval of her school to be absent for such purpose and this was granted on the basis she personally provide someone qualified to take classes for the periods for which she was rostered. As the higher school certificate students had already ceased to attend classes and the applicant was paid on the basis of a proportion of the full time rate the result would be a "profit" to the applicant since she would have to pay her relief for a lesser number of periods than she herself was, in effect, being paid for. She proceeded on this basis, paid $572 to an individual to take her classes and received not only her salary from the school but also remuneration as a marker from the N.S.W. Department of Education.

9. It was argued for the Commissioner that the expenditure could not, inter alia, be said to be incurred in gaining assessable income from her school and that, in relation to the marking

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income, it was "preliminary expenditure" and not allowable having regard to the decisions in
F.C. of T. v. Maddalena 71 ATC 4161:
Lodge v. F.C. of T. 72 ATC 4174 and Martin v. F.C. of T. 84 ATC 4513. Whilst the Tribunal would not disagree with the second aspect it is of the view that there is a clear nexus in relation to the continued receipt of her salary from the school. Accordingly the Tribunal would set aside the Commissioner's decision in relation to this claim.

Conclusion

10. For the above reasons the Tribunal would vary the Commissioner's decision upon the applicant's objection to her assessment for the year ended 30 June 1983 by allowing a deduction for the amount of $572.