Edited version of your written advice

Authorisation Number: 1012863360918

Date of advice: 10 September 2015

Ruling

Subject: Home to work travel

Question

Are you entitled to a deduction for motor vehicle expenses incurred whilst travelling to and from work?

Answer:

Yes.

This ruling applies for the following periods:

Year ended 30 June 2015

The scheme commenced on:

1 July 2014

Relevant facts

You are employed as a traffic controller to work at locations where rural roads are being mended.

You are required to travel from your home to the various locations as advised by your employer.

You are advised by your employer the night before of the location you are required to attend the next day to carry out your duties.

You may spend one day or several days at a particular site.

Some days you work at more than one site where the repair is completed in a short time.

Sometimes you are also required to stay away from home overnight where the work is for more than one day and the site is a substantial distance away.

You use a logbook to keep records of your motor vehicle expenses.

You keep documentation to substantiate your motor vehicle expenses.

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. 

A deduction is generally not deductible for the cost of travel by an employee 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 the performance of those duties (see Taxation Ruling TR 95/34). 

However, a deduction is allowable for the cost of travel between home and work for an employee who is engaged in itinerant work. TR 95/34 provides guidelines for establishing whether an employee is carrying out itinerant work.

As per TR 95/34, the following characteristics have emerged from cases as being indicators of itinerancy: 

• travel is a fundamental part of the employee's work

• the existence of a 'web' of work places in the employee's regular employment, that is, the employee has no fixed place of work

• the employee continually travels from one worksite to another. An employee must regularly work at more than one worksite before returning to his or her usual place of residence, and

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

It should be noted that the above characteristics are not exhaustive and no single factor on its own is necessarily decisive. The question of whether an employee's work is itinerant is one of fact, to be determined according to individual circumstances.

In your case, it is considered that travel is a fundamental part of your work. You regularly attend various worksites to carry out your duties and there is no single 'workplace' which could be considered your fixed place of work. You are advised by your employer the night before as to the location you need to attend the next day. Some days you work at more than one site. You rarely attend the same work locations or stay at a worksite for an extended period of time. There is no regular pattern of worksites you are required to attend.

Having regard to all your circumstances it is considered you are engaged in itinerant work and the cost of travel from home to your work locations is deductible under section 8-1 of the ITAA 1997.