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Ruling

Subject: Work-related clothing expenses

Question 1:

Are you entitled to claim a deduction for black trousers, leather shoes and belt?

Answer:

No

Question 2:

Are you entitled to claim a deduction for a chef's uniform?

Answer:

Yes

Question 3:

Are you entitled to claim a deduction for safety shoes, heavy cotton tradesman's pants, durable shirts and a hat?

Answer:

Yes

This ruling applies for the following periods:

Year ended 30 June 2012

The scheme commences on:

1 July 2011

Relevant facts and circumstances

You are employed in three different occupations all of which require various forms of work-related clothing:

· a front of house position where you are provided with a uniform shirt but must supply your own black trousers, leather shoes and belt;

· an apprentice chef where you wear a chef's uniform; and

· a maintenance/farm hand where you wear safety shoes, heavy cotton tradesman's pants, durable shirts and a hat.

· You purchase these items yourself and they are costly to maintain.

Relevant legislative provisions

Income Tax Assessment Act 1997 Section 8-1

Reasons for decision

A deduction for work-related clothing expenses may be available under section 8-1 of the Income Tax Assessment Act 1997 (ITAA 1997).

Section 8-1 of the ITAA 1997 states that expenses incurred in gaining or producing assessable income are allowable deductions except to the extent to which they are:

· losses or outgoings of capital: or

· is a capital, private or domestic nature; or

· incurred in the gaining of exempt income. 

Clothing expenses are generally considered to be private in nature and therefore not deductible. Taxation Ruling TR 97/12 discusses the circumstances where clothing expenses may qualify as a tax deduction.

Generally speaking, conventional clothing is not deductible. This is the case even where an employer directs an employee to wear a certain style or colour of conventional clothing, or a type or style of conventional clothing is required for success in a particular occupation. Even if the clothing is not worn anywhere besides work, it does not change its nature of being conventional clothing and is therefore not deductible.

However a deduction is allowable if the clothing is:

(a) a compulsory and distinctive uniform;

(b) a registered non-compulsory uniform;

(c) occupation specific clothing; or

(d) protective

Paragraph 25 of TR 97/12 addresses the deductibility of occupation specific clothing. Occupation specific clothing is allowable as a deduction as the distinctive characteristics of the clothing provide the nexus between the expenditure and the work activity. An example of occupation specific clothing is the chef's hat, white jacket and checked pants worn by chefs.

Taxation Ruling TR 2003/16 discusses the deductibility of protective clothing and footwear. Clothing and footwear of a protective nature may be deductible in the following circumstances:

· you are required to work in an environment which could be harmful if adequate safety precautions are not taken;

· the use of the item in the work place makes it unsuitable for private or personal use;  

· expenditure on the item is additional to your normal private or domestic expenditure on such items, for example - do you need to wear additional protective clothing at work to guard against risk or injury from extreme weather or other potentially unsafe conditions?

· the item is qualitatively different to items of a comparable nature used privately or domestically; for example - is the item made to cope with more rigorous work conditions?

· you use the item principally for income producing activities;  

· it is a requirement of your employer, work-related safety laws or an industrial agreement for you to use protective items;

· the use of the item adds to your workplace productivity; and

· any other feature of your use of the item for protective purposes which may further indicate your expenditure on that item has the essential character of an outgoing incurred in gaining your assessable income.

Question 1:

The black pants, leather shoes and belt you wear in your employment as front of house staff is considered conventional clothing and is therefore not deductible. The items are not identifiable as a uniform, are not occupation specific as they can be worn outside of your work, and are not protective.

Question 2:

The chef's uniform is considered to be occupation specific clothing and is therefore deductible.

Question 3:

The safety shoes, heavy cotton tradesman's pants, durable shirts and hat are considered to be protective in nature and are therefore deductible.