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Edited version of your written advice
Authorisation Number: 1012923013869
Date of advice: 8 December 2015
Ruling
Subject: Travel expenses
Question
Are you entitled to a deduction for your travel expenses?
Answer
No.
This ruling applies for the following periods:
Year ended 30 June 2015
The scheme commences on:
1 July 2014
Relevant facts and circumstances
You have two positions in different cities that you work at for a few days per week each.
You use your own car to get travel to the cities and pay for your food when you are there.
You do not receive a travel or meal allowance.
You do not carry any equipment.
Relevant legislative provisions
Income Tax Assessment Act 1997 Section 8-1
Reasons for decision
Section 8-1 of the Income Tax Assessment Act 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.
The principle that travel to and from work is ordinarily not deductible was settled by the decision in Lunney v. Federal Commissioner of Taxation (1958) 100 CLR 478 (Lunney's case). In this case, the Full High Court held that costs incurred by a taxpayer in travelling to the place where they work are expenses incurred in order to enable them to earn income but are not expenses incurred in the course of earning that income. The travel is considered to be of an essentially private or domestic nature.
The fact that certain expenditure, such as travelling to work, must be incurred in order to be able to derive assessable income, does not necessarily mean that the expenditure is incidental and relevant to the derivation of assessable income or that it is incurred in the course of gaining or producing assessable income. It is a prerequisite to the earning of assessable income rather than being incurred in the course of gaining that income.
The essential character of the travel to and from work is that of a private and domestic nature, related to personal and living expenses as part of the taxpayer's choice of where to live, in choosing to live away from and what distance from work.
There are exceptions where travel between home and work are deductible, for example where you transport bulky tools and equipment, your home is a base of employment and you commence your duties prior to leaving home, or you regularly work at more than one site each day before returning home.
The general principles established in Lunney's case have been followed in many subsequent cases and would hold equally for the travel expenses in your case. That is, the travel expenses are a prerequisite to the earning of your income and are not expenditure incurred in the course of gaining or producing income. Your circumstances do not meet any of the exceptions which would allow your travel expenses to be deductible.
Your travel expenses are incurred by you in putting yourself in a position where you can perform your duties, rather than in the performance of your duties. Therefore you are not entitled to a deduction for the travel expenses you incur.