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Edited version of your written advice
Authorisation Number: 1012911381518
Date of advice: 26 November 2015
Ruling
Subject: Deductibility of meal expanses
Questions and answers
1. Are you entitled to claim meal expenses incurred during shifts that span overnight?
No.
2. Are you entitled to claim meal expenses incurred when purchasing meals when you are out on a call-out job?
No.
3. Are you entitled to claim incidental expenses incurred in connection with your travel during shifts that span overnight?
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 are employed as pilot. You work very long shifts, during which time you are located at the base, ready to be called out on a job where you are involved in transporting people.
You work on different roster cycles. You regularly work shifts of between 24 hours and 36 hours (and, therefore, which span overnight), during which you are available to be called out on a job. You estimate the average job duration to be between five and eight hours in length and you are regularly tasked on back-to-back jobs, that is, going directly from one job to another.
While at work, you are required to remain at the base and cannot leave (other than for a call-out job) as you are required to be available at all times to ensure you can be airborne within X minutes of dispatch. The base has cooking and refrigeration facilities and you eat there when given the opportunity.
When called out on a job, there are no cooking or refrigeration facilities available and you are not permitted to carry food with you. Due to the average job duration and the likelihood of getting called on another subsequent job before returning to the base, you are typically away from the base for at least one meal time, and are regularly away for multiple meal times, during which you are forced to purchase meals away from your base.
You do not receive an overtime meal allowance.
You have not kept most of the records of your meal expenses but you do have some records.
You intend to determine the deductible amount based on reasonable estimates calculated from a sample period and, for future years, by retaining records of all expenditure.
Relevant legislative provisions
Section 8-1 of the Income Tax Assessment Act 1997
Reasons for decision
Section 8-1 of the Income Tax Assessment Act 1997 (ITAA 1997) provides that a deduction is allowable for expenses incurred in gaining or producing assessable income, provided those expenses are not capital, private or domestic in nature.
Generally, expenses for meals and incidentals are not allowable as deductions under section 8-1 of the ITAA on the basis there isn't a sufficient connection between the expenditure and the income earning activities of a taxpayer. The deductibility of expenditure on meals and incidentals will depend on the essential character of the expenditure on the basis of the facts of each case.
You can claim a deduction for overtime meal expenses provided that you received a genuine overtime meal allowance from your employer that was paid under an industrial law, award or agreement. Any amount for overtime meals that have been included as part of your normal salary or wages (for example, under a workplace agreement) is not considered to be an overtime meal allowance.
In your case, you do not receive an overtime meal allowance from your employer that was paid under an industrial law, award or agreement. Further, the terms of your employment require you to travel from your base to pick up people and then transport them to the place required and you are required to be available for a call-out at any time of day or night, depending on your work cycle. This means that you are required by the circumstances of your employment to purchase meals and incidentals as and when the opportunity permits; usually at the place you are directed to travel to. As such, the expenditure is the same as for any other employee who has to purchase means and incidentals during their working day as and when time permits.
As a result, the expenses you incur for meals and incidentals in the course of your employment are considered to be private in nature and are not deductible under section 8-1 of the ITAA 1997.