Edited version of your private ruling

Authorisation Number: 1012575066847

Ruling

Subject: Travel expenses

Question

Are you entitled to a deduction for the cost of travelling between home and work on the basis that your employment is considered itinerant?

Answer

No.

This ruling applies for the following periods:

Year ended 30 June 2013

The scheme commences on:

1 July 2012

Relevant facts and circumstances

You worked as an employee.

You could work at any store in the City A area.

Your roster changed weekly. You never had fixed days at stores and sometimes you would have to go to a different store on that day.

Your roster came out weekly and could change at the last moments notice.

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) broadly allows a deduction for any losses or outgoings to the extent to which they are incurred in gaining or producing assessable income except to the extent outgoings are of a capital, private or domestic nature.

A deduction is generally not allowable for the cost of transport between home and the normal workplace. However, a deduction is allowable for the cost of travelling between home and work if an employee's work is itinerant (Taxation Ruling TR 95/34).

The question of whether an employees 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. 

There have been a number of cases where deductions for transport expenses were allowed on the basis of the taxpayers shifting places of work. Shifting places of work is another term for itinerancy. The following characteristics have emerged from these cases as being indicators of itinerancy: 

· travel is a fundamental part of the employees work

· the existence of a web of work places in the employees regular employment, that is, the employee has no fixed place of work

· the employee continually travels from one work site to another (an employee must regularly work at more than one work site before returning to his or her usual place of residence)

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

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

o the employees home constitutes a base of operations

o the employee has to carry bulky equipment from home to different work sites, and

o the employer provides an allowance in recognition of the employees need to travel continually between different work sites.

Your case is similar to the example in TR 95/34 of Cathy who is a bank employee attached to a central branch. Apart from her regular duties she also performs relief work at nominated branches within a given area. Cathy is normally aware of the branches she must attend for relief duties well in advance, although she may occasionally be called at short notice. Cathy is not engaged in itinerant employment because:

· travel is not a fundamental part of her employment;

· there is no continual travel from one work site to another. Upon commencement of her duties at a branch she is not required to travel;

· the uncertainty in her employment is minimal. She is generally aware in advance of the branch she must attend; and

· she has several regular places of employment.

In your case, we consider that travel is not a fundamental part of your employment. While you do perform your duties at more than one location, you generally travel to only one location in a work day, so it cannot be considered that you have a web of work places or that continuous travel between work sites is a part of your regular duties. There is no degree of uncertainty, as you are advised in advance as to which store you need to attend. None of the other factors that may indicate itinerancy are applicable to your circumstances.

Therefore in view of the above, your employment is not considered itinerant in nature as you generally travel to only one location to work on any given day. The expenses are incurred to put you in a position to perform the duties of your employment, rather than in the performance of those duties. As such you are not entitled to a deduction for travel expenses between your home and a client's home under section 8-1 of the ITAA 1997.