Edited version of your written advice

Authorisation Number: 1012802632220

Ruling

Subject: Work related expenses - fitness

Question

Are you entitled to a deduction for expenses relating to maintaining your fitness?

Answer

No.

This ruling applies for the following periods:

Year ended 30 June 2015

The scheme commences on:

1 June 2014

Relevant facts and circumstances

You are required by your employer to maintain a minimum level of physical fitness and are tested once a year on your fitness and firearm skills. If you did not pass these tests you would lose permit to operate in this employment.

You incur expenditure relating to maintaining at least this minimum standard of fitness and firearm skills.

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) 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, or relate to the earning of exempt income.

Generally expenses incurred in keeping fit are inherently private in nature as it ultimately involves the person's own physical wellbeing. This position does not change even if the person is employed to undertake physical activity as part of their duties. For example, a police officer or a member of the military would not generally be able to deduct the costs of maintaining their fitness levels.

Taxation Determination TD 93/114 examines whether a police officer who is required to maintain an adequate level of physical fitness is entitled to claim a deduction for fitness related expenses. Where an officer is carrying out ordinary duties and does not perform regular strenuous physical activity, they are not entitled to a deduction for expenses incurred in keeping fit.

An employer's requirement that an employee incur expenditure which is not related to income-producing activities does not convert that expenditure into a deductible outgoing (FC of T v. Cooper 91 ATC 4396 at 4414; (1991) 21 ATR 1616 at 1636 (Coopers case)). Therefore, whilst Police Regulations may require an officer to remain in a physically fit condition, this does not mean expenditure related to keeping fit is allowable as an income tax deduction.

However, there may be circumstances where such expenditure by a police officer is an essential element of gaining income. This could occur in those occupations within the police force where strenuous physical activity by an officer is an essential and regular element of performing that officer's duties. It is considered a police academy physical training instructor may be in this category.

Taxation Ruling TR 95/17 further discusses this issue with regards to Defence Force members. Defence members are required to maintain a high standard of general physical fitness, however expenses incurred in maintaining this standard of fitness are considered to be private in nature and not allowable as a deduction. The example at paragraph 119 of TR 95/17 explains that an infantryman who, in addition to the employer's requirement to undertake fitness training for two hours per day three times per week while on duty, also attended his local gymnasium once a week in his own time. The infantryman is denied a deduction for any cost incurred in attending the gymnasium as the costs are private expenses.

Similarly as in TD 93/114 there are exceptions to this view. For example, where the defence member can demonstrate that strenuous physical activity is an essential and regular element of their income-earning activities and that these costs were incurred to maintain a level of fitness well above the ADF general standard. Examples of this are physical training instructors and those in the Special Air Services Regiment.

In your situation, you are required to maintain a certain level of fitness and that there is potential for your duties to require strenuous physical activity. However the level of fitness required cannot be considered to be at the highest level nor at a level which makes it an essential element of your employment such as that required by a fitness or physical training instructor.

Consequently you are not entitled to a deduction for the fitness expenses you incur.