Edited version of your written advice

Authorisation Number: 1012872119301

Date of advice: 3 September 2015

Ruling

Subject: Travel expenses

Question

Are you entitled a deduction for travel between your home and the airport?

Answer

No.

This ruling applies for the following period

Year ended 30 June 2015.

The scheme commences on

1 July 2014

Relevant facts and circumstances

You worked in various sites on a roster basis.

You drove between your home and the airport using your car.

Your employer paid for the flights between your home airport and the worksite.

You carried a large suitcase containing heavy duty protective work clothes and work gear, boots, hard hat, work belt and work jackets.

The suitcase with gear weighed more than 20 kilograms.

You carried your equipment to and from the worksite as your employer sent to you different worksites.

Relevant legislative provisions

Income Tax Assessment Act 1997 Section 8-1

Reasons for decision

Summary

You are not entitled to a deduction for car expenses when travelling to and from the airport as the expenses are considered private and domestic in nature.

Detailed reasoning

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 or a provision of the taxation legislation excludes it.

Generally the expenses of travel to and from work are not deductible. This is either because such expenditure is private in nature, or it is not an expense incurred in gaining or producing assessable income.

However, there are situations where it has been accepted that travel by employees from home to work is deductible as the employee is transporting bulky equipment.

The question of what constitutes bulky equipment must be considered according to the individual circumstances in each case.

The Administrative Appeals Tribunal in Crestani v. FC of T 98 ATC 2219; 40 ATR 1037 (Crestani's case) found the taxpayer's toolbox measuring 25 cm * 28 cm * 57 cm and weighing 27 kilograms was bulky and cumbersome. In this case, the taxpayer was an aircraft engineer who worked at Sydney Airport. They transported their toolbox home at the end of each shift as there was no secure storage at work. The Tribunal held that the home to work travel was attributed to the transportation of these tools. The expenses incurred in transporting these tools were deductible and the taxpayer was simply one of these fortunate few who is able to hitch a free ride on his tool box.

In the case of bulky equipment, the cost is attributed to the transportation of the bulky equipment rather than private travel between home and work where the transportation of the equipment is essential and is not done as a matter of personal choice or convenience and there is no secure storage provide at the workplace.

In Case 43/94 94 ATC 387, a flight sergeant with the Royal Australian Air Force was denied a deduction for the cost of transporting his flying suit and other items used for work purposes. These items were carried in:

• a duffle bag measuring 75 cm long * 55 cm wide * 50 cm deep and weighing 20 kilograms when packed

• a suit bag which weighed 10 kilograms when packed, and

• a briefcase-sized navigational bag which contained charts, work manuals and study materials.

It was held that the mode of transporting the items was simply a consequence of the means adopted by the taxpayer to convey him to work. It was considered that the duffle bag was not of sufficient size or weight to impede facile transport.

In your case, you carry a bag containing your heavy duty protective work clothes and work gear, boots, hard hat, work belt and work jackets. The work clothes are considered to be personal in nature even though they provide are heavy duty to provide additional protection to standard work clothing. While the suitcase may appear bulky, the transport of your personal items and protective equipment is incidental to the primary purpose of transporting yourself to work. Similar to Case 43/94 we consider the protective equipment of boots, hard hat and work belt, when separated from your personal effects is not considered to be of a size or weight that would make their transportation to be of a size or weight that would make their transportation difficult. Thus, the equipment carried is not considered to be of such bulk that it would change the primary purpose of your travel from one of transporting yourself to and from work to one of transporting the equipment.

Therefore, the car expenses you incur in travelling between home and the airport are private in nature. Accordingly, the expenses are not deductible under section 8-1 of the ITAA 1997.