Edited version of your written advice

Authorisation Number: 1013083290745

Date of advice: 1 September 2016

Ruling

Subject: Deduction - Travel

Question and answer:

Are you entitled to a deduction for work related travel expenses?

No.

This ruling applies for the following period:

Year ended 30 June 2016

The scheme commenced on

1 July 2015

Relevant facts

You are employed.

In order to for fill your employment duties you are required to travel to clients' homes.

Your pattern of travel is as follows:

On one day you travel back and forth from your home to your shifts at Client A's home.

On other work days you travel to Client A's and Client B's home to undertake your shifts, as there is an extended period between each of your shifts you return to your home between each shift.

You have some regular shifts and some where you fill in on an occasional basis. Currently, regular shifts make up a bit less than 60 hours a fortnight and irregular shifts come to a bit less than 20 hours a fortnight.

Notice for non-schedule shifts ranges from about week in advance (allocated over the phone a few days after your fortnightly roster arrives in the post) to 20 minutes in advance. Sometimes I am called to go to a shift immediately when for some reason a support worker has not turned up.

You do not generally receive a travel allowance. For a while you did received an allowance for one client, but that allowance has been terminated. Your employer sometimes offers travel allowance when they are desperate to get someone to do a shift, especially if it involves quite a long trip, but you have never accepted such a shift.

You are only paid for the time spent at the Client's home.

You are not required to carry bulky equipment.

Relevant legislative provisions

Income Tax Assessment Act 1997 Section 8-1

Reasons for decision

Work-related expenses generally fall for consideration under section 8-1 of the Income Tax Assessment Act 1997 (ITAA 1997). This section allows a deduction for losses and outgoings which are incurred in the course of gaining or producing assessable income, unless the losses or outgoings are of a capital, private or domestic nature.

Home to work

A deduction is generally not allowable for the cost of travel by an employee between their home and 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 of employment, rather than in the performance of those duties (Lunney & Hayley v. Federal Commissioner of Taxation (1958) 100 CLR 478; (1958) 11 ATD 404; (1958) 7 AITR 166).

The essentially private character of travel between home and work is not effected by factors such as the mode of transport, the availability of transport, the lack of suitable public transport, the erratic times of employment, the time of travel, the distance of travel and the necessity of travel (Taxation Ruling IT 2543); however, there are situations where it has been accepted that travel by employees from home to work is deductible. These situations include:

• where the taxpayer's home constitutes a place of employment and travel is between two places of employment or business Garrett v. FCT 82 ATC 4060, 12 ATR 684,

• where the employment can be construed as having commenced at the time of leaving home FCT v. Collings 76 ATC 4254, 6 ATR 476,

• where you travel between home and shifting places of work, that is, an itinerant occupation FCT v. Wiener 78 ATC 4006, 8 ATR 335, and

• the transportation of bulky equipment in some circumstances FCT v. Vogt 75 ATC 4073, 5 ATR 274.

Itinerant worker

Taxation Ruling TR 95/34 Income tax: employees carrying out itinerant work - deductions, allowances and reimbursements for transport expenses; discusses the Commissioner interpretation of the meaning of an itinerant work.

Taxation Ruling TR 95/34 provides guidelines for establishing whether an employee is carrying out itinerant work. These guidelines have been established through the views taken by the Courts, Boards of Review and Administrative Appeals Tribunal in deciding when an employee's work is itinerant.  The following characteristics have emerged from these cases as being indicators of itinerancy:

• Travel is a fundamental part of the employees 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 work site to another. An employee must regularly work at more than one work site before returning to his or her usual place of residence.

• 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).

Bulky equipment

Taxation Ruling TR 95/18 Income tax: employee truck drivers-allowances, reimbursements and work-related deductions, discusses the Commissioners view on the deductibility of some work related expenses.

Tax Ruling TR 95/18 states:

Transport expenses: Transport expenses include public transport fares and the running costs associated with using motor vehicles, motor cycles, bicycles etc., for work. They do not include accommodation, meals and incidental expenses (see Travel expenses , paragraphs 157 to 172). The treatment of transport expenses incurred by a truck driver when travelling is considered below:

Travel between home and work: A deduction is not allowable for the cost of travel between home and the normal work place as it is generally considered to be a private expense. This principle is not altered by the performance of incidental tasks en route (paragraph 138).

Travel between home and work - transporting bulky equipment: A deduction is allowable if the transport expenses can be attributed to the transportation of bulky equipment rather than to private travel between home and work. A deduction is not allowable if the equipment is transported to and from work by the truck driver as a matter of convenience. A deduction is not allowable if a secure area for the storage of equipment is provided at the work place (paragraphs 139 and 140)

Your travel is from your home to your normal place of work (your client's home) and return. While your journeys are repeated during the day; in essence the travel is between home and work. Travel is not a fundamental part of your work and you generally have a fixed place of work. You do not travel from one work site to another during the day nor are you required to transport bulky equipment. Accordingly, you are not entitled to a deduction for your travel expenses.