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Ruling
Subject: Work Related Expenses
Question:
Are additional airfare fees deductible?
Answer:
No
This ruling applies for the following period
Year ended 30 June 2012
The scheme commenced on
1 July 2011
Relevant facts
You are employed on a fly in/fly out arrangement from City A to your workplace.
You pay your own airfares from your home in City B to City A.
In the 2012 income year you incurred additional airfare fees for last minute roster changes by your employer.
Relevant legislative provisions
Income Tax Assessment Act 1997 Section 8-1
Reasons for decision
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.
Certain expenditure is incurred in order to be in a position to be able to derive assessable income, for example unless a person arrives at work it is not possible to derive income. This does not mean that the expenditure is incurred in the course of gaining or producing assessable income. Rather, the expenses are incurred to enable the taxpayer to commence income earning activities (Lunney & Hayley v. Federal Commissioner of Taxation (1958) 100 CLR 478; (1958) 11 ATD 404; (1958) 7 AITR 166).
A deduction is, generally, not allowable for the cost of travel by an individual 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, rather than in performance of those duties.
The lack of suitable public transport, the erratic hours and times of employment, the time of travel, the distance of travel and the unavailability of residential accommodation near the place of work are not factors which will alter the essential character of travel between home and work.
In your case, you have incurred additional airfare fees due to changes to last minute roster changes, under a fly-in/fly-out arrangement. Although these expenses allow you to get to a location to carry out your employment, the expenses are incurred in putting yourself in a position where you can perform your duties, rather than in the performance of your duties.
Accordingly the costs that you incur for additional airfare fees are considered to be private in nature and therefore not deductible as a work related expense.