Edited version of your written advice

Authorisation Number: 1012795552179

Ruling

Subject: Itinerancy

Question 1

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

Your employer provides you with a roster whereby you are directed to commence work at a particular location each fortnight.

The roster may specify several different starting locations during the fortnightly period.

You travel to only one site each day.

You use your motor vehicle to travel to each location.

There is no central office provided 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 (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:

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

• the employees home constitutes a base of operations

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

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

Travel is a fundamental part of the employees work and home as a base of operations

TR 95/34 provides that in order for an individual's 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.

TR 95/34 also provides that an individual's 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 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 contacted by telephone by a nursing agency when work was available. The taxpayer in this case believed her home constituted a base of employment because she received instructions about her next work location over the telephone which was the only method of contacting her. The Court held that the mere receipt of telephone calls from an employer or employment agency was not sufficient to allow the home to be classed as a base of operations.

In your case, your typical work pattern involves travel to multiple sites. However, this pattern shows that you attend only one workplace each day 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. Therefore, travel is not a fundamental part of your work and your home is not considered to be a base of operations.

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 one site each day but have a number of sites you may need to attend. This does not mean that you have a web of workplaces. We consider each site to be a fixed place of employment. Attending different sites on separate days does 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.

Summary

In your case, your employer provides you with a roster which specifies different work locations each period. Although your typical weekly pattern involves travel to multiple sites, each site is considered to be a fixed place of employment. The location that you will be required to attend is not uncertain as you know in advance which site you are required to attend. While you do not have a central office, this does not establish your home as a base of operations.

Therefore 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 your worksite under section 8-1 of the ITAA 1997.