Edited version of private ruling

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Ruling

Subject: itinerant worker for tax purposes

Are you an itinerant worker for tax purposes?

No.

This ruling applies for the following period

Year ended 30 June 2009

Year ended 30 June 2010

Year ended 30 June 2011

Year ended 30 June 2012

The scheme commenced on

1 July 2008

Relevant facts

You work as a contract project manager.

You work at different sites on different days of the week and on occasion are required to travel to different sites on a given day to attend meetings.

Your typical weekly pattern generally involves attendance at one of several sites on a set day per week and attendance at another site for office meetings.

Even when you are working at one location, you are often required to attend meetings in at least one other location several times per week.

The work sites that you visit are determined by requirements of the project or task at hand.

You mostly determine where you are required to work in conjunction with the staff of the client and their availability, or urgency of tasks required to be completed.

Each of the organisations that you work for provide you with a desk, a computer and usually a phone. When working from multiple sites this is typically a hot desk situation.

At times you work from home to meet deadlines. This is usually for the purpose of completing documentation or information requests that are required by your clients.

You have also had to work from home and in transit in an advisory capacity to coordinate your team and clients with the current task or status of what you are currently working on.

You are required to be contactable by email and phone outside of normal business hours.

As a result of receiving these calls or emails, you may need to respond and review documentation.

You have not stated that you carried bulky equipment to and from your work sites, or received a continual travel allowance.

Relevant legislative provisions

Income Tax Assessment Act 1997 section 8-1

Income Tax Assessment Act 1936 section 25(1)

Reasons for decision

Taxation Ruling TR 95/34 provides guidelines for establishing whether an employee is carrying out itinerant work. 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.

There have been a number of Court cases that have considered when an individuals work can be considered to be itinerant. From these cases a number of characteristics have emerged as being indicators of itinerancy. These are as follows:

1. Travel is a fundamental part of the individual's work

2. There is a web of workplaces in the individual's regular employment

3. The individual continually travels from one work site to another.

Other factors that are considered to indicate itinerancy to a lesser degree are:

4. The individual has a degree of uncertainty of location in their employment

5. The individual's home constitutes a base of operations

6. The individual has to carry bulky equipment from home to different worksites

7. The individual's employer provides an allowance in recognition of the individuals need to travel continually between different work sites.

These factors shall now be considered in greater detail.

Travel is a fundamental part of the employees work

TR 95/34 provides that in order for an individuals work to be considered itinerant, the very nature of the individuals work must make it necessary for them to travel continually from one place to another in order to carry out their duties. It is not sufficient for an individual to choose to perform their duties in an alternative location, for convenience. For example, an individual is not considered to be itinerant because they choose to work from a home office for convenience.

In FC of T v Weiner 78 ATC 4006: (1978) 8 ATR 335 (Wiener) a teacher was required to work at a minimum of four different work places every day. The court in Weiner's case came to the conclusion that travel was inherent in the teacher's work because the nature of her job made travel a fundamental part of the taxpayer's work. She was required to move continually between one school and the next, on a strict timetable and it was necessary for her to have transport at whichever school she commenced her teaching duties at and that the transport remained at her disposal throughout the day.

This can be contrasted with the situation in Federal Commissioner of Taxation v. Genys (1987) 17 FCR 495; 87 ATC 4875; (1987) 19 ATR 356 (Genys). In this case the taxpayer was a registered nurse who provided relief work with various hospitals. When a hospital required a nurse they would contact an employment agency who would in turn contact the taxpayer. The Court determined that the taxpayer was not required to travel in the course of her duties. The fact that she may attend a different hospital on different days did not classify her work as itinerant. She did not travel between two places of work after the commencement of her duties, she simply drove from home to work and back again.

In your case, your typical weekly work pattern involves travel to multiple sites and at times you travel from these sites to attend meetings at other sites. However, this pattern shows that for the majority of your week you attend only one workplace each day (apart from a limited number of meetings in other locations) rather than multiple work places each day. This can be contrasted with the case of Weiner where the taxpayer was required to attend four different schools before returning home and compared with Genys where although the taxpayer travelled to different work sites every day she did not travel to multiple sites once at work. Travel is not a fundamental part of your work.

Web of workplaces

TR 95/34 provides that an individual may be an itinerant worker where the location of their work sites make it necessary for the individual to perform work at a single site and then move to other sites on a continuous basis. The fact that an individual performs duties at more than one work location is not sufficient in itself to constitute a web of work places. Often each work place is regarded as a fixed place of employment.

In Case U97 87 ATC 584; AAT Case 68 (1987) 18 ATR 3491 (Case U97) a taxpayer was employed as a fireman. He worked several days a week at one fire station and then other days of the week at a second fire station. Every few months the fire stations that he worked at for the majority of the week would change. The tribunal concluded that the fireman was not an itinerant worker. They were satisfied he had one place of employment for several days of the week and another place of employment for other days of the week.

In your case, you generally attend the same site each day of the week and you attend a meeting on another site on a different day. This does not mean that you have a web of workplaces. At each site you are provided with a desk, a computer and usually a telephone. We consider each site to be a fixed place of employment. A limited number of meetings at other sites do not change the nature of your employment. As with the taxpayer in Case U97 you have a fixed place of employment at each site you attend. Therefore, we do not consider that you are an itinerant worker by reason of travelling to a web of workplaces each day.

Continual travel from one workplace to another

Continual travel refers to the frequency in which an employee moves from one site to another. TR 95/34 provides examples of when an individual is considered to be a continually travelling. The ATO consider the frequency of travel between work sites is an important element. The individual's usual pattern of work must involve continual travel to more than one work site before returning to their usual place of residence.

This issue was discussed by the Tribunal in Case U97. They contrasted the fireman's situation with that of the teacher in Weiner's case. It was stated that had Weiner not been required to attend more than one school on any one day, the court may well have found that she was not an itinerant worker. The Tribunal contrasted this to the fireman's situation, stating that once he had arrived at one of the stations, he remained there until the end of his shift before returning home. There was no evidence that his duties required him to use his car from the station to travel to other stations during the course of his shift.

In your case, you generally attend the same site on the same day of each week. You also travel to another site to attend a meeting one day per week and also attend meetings in at least one other location several times per week. However, this pattern of work does not require continual travel to more than one workplace, rather we consider it to be occasional travel. Therefore, you are not considered to be an itinerant worker by operation of the continual travel indicator.

Other factors

The following factors on their own, do not establish itinerancy. However, they may support the classification of an individuals work as itinerant. (We have not discussed the application of a taxpayer carrying bulky equipment to and from work sites, or when the taxpayer has received an allowance for continual travel from their employer as these factors do not apply to your case.)

Uncertainty of location

TR 95/34 provides that an individuals employment may be considered itinerant if the worker is uncertain of the location of their worksite. Uncertainty in this context was discussed in Case T106 86 ATC 1192; AAT Case 17 (1987) 18 ATR 3093 (Case T106). The taxpayer in this case was often uncertain about which work site he would be required to attend until the day he was required to attend. The court found that he was an itinerant worker because there was no regular pattern as to which work site he would be called on to attend.

In your case, your work location is not considered to be uncertain. While the work sites that you visit are determined by requirements of the project or task at hand, you mostly determine where you are required to work in conjunction with the staff of the client and their availability, or urgency of tasks required to be completed. You generally attend the same site on the same day each week. Therefore, we do not consider you to be itinerant by reason of being uncertain of your work location.

Home as a base of operations

TR 95/34 provides that an individuals home may constitute a base of operations where the individuals work commences at or before the time of leaving home to travel to work and the responsibility for completing the work is not completed until the taxpayer attends the worksite.

In FC of T v. Collings 76 ATC 4254: (1976) 6 ATR 476 (Collings) an individuals work was considered to be itinerant. In Collings' case, the taxpayer was a highly trained computer consultant and she was required to be on duty 24 hours per day. If she was unable to resolve the problem on her home based computer she would return to the office to fix the problem. The court found that she had commenced her duties before leaving home and travelled to work to complete those duties. On the days that the taxpayer returned to work to complete her duties after hours:

She had commenced performance of her duties before leaving home and travelled to work to complete those duties. Her obligation was more than just being on stand by at home.

She did not choose to do part of the work in two separate places. The two places of work were a necessary obligation arising from the nature of the special duties of her employment.

Whilst we acknowledge that you complete work at home on occasions this does not make your home a base of operations. Your employer provides you with a desk, a computer and usually a telephone at their sites which you can use to complete this work. This is considered to be your base of operations. In our view this indicates that you work from home as a matter of convenience.

You also need to be contactable outside business hours and in transit, and perform some work at home. Whilst it is arguable that during these times, your home could be considered to be a base of operations, this factor alone would not make you an itinerant worker. The location of your base of operations is a lesser factor in determining itinerancy and needs to be considered with the other factors discussed above.

Summary

In your case, you are a project manager and you contract your services to various organisations. Although your typical weekly pattern involves travel to multiple sites, each site is considered to be a fixed place of employment. You are provided with a desk, a computer and usually a phone. The location that you will be required to attend is not uncertain as you know in advance which site you are required to attend. The fact that you have to travel to meetings in other sites sometimes does not make your travel itinerant. While you undertake some work at home, this does not establish your home as a base of operations. We consider you do this as a matter of convenience and whilst it is acknowledged that your home may at times become a base of operations outside of working hours, this factor alone is not sufficient to determine that your work is itinerant.

Therefore, you are not considered to be an itinerant worker for tax purposes.