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Edited version of your written advice
Authorisation Number: 1051369023293
Date of advice: 7 May 2018
Ruling
Subject: Work related expenses
Question
Can I deduct personal therapy sessions as a work related expense?
Answer
No
This ruling applies for the following period:
Year ending 30 June 20XX
The scheme commences on:
1 July 20XX
Relevant facts and circumstances
You are a qualified medical practitioner working full time as a counsellor.
You work closely with individuals with a history of trauma.
You are encouraged to obtain weekly therapy from a qualified medical practitioner for your own wellbeing.
Relevant legislative provisions
Income Tax Assessment Act 1997 Section 8-1
Section 8-1 of the Income Tax Assessment Act 1997 states that you can deduct from your assessable income any loss or outgoing to the extent that it is incurred in gaining or producing your assessable income. You cannot claim a deduction if the loss or outgoing is of a capital, private or domestic nature.
For a deduction to be allowed there must be sufficient nexus between the loss or outgoing and the assessable income. The expense must give rise to or help produce assessable income for it to be deductible.
In Taxation Determination TD 93/112 the Commissioner adopted the reasoning of Hill J in FC of T v Cooper (1990) 21 ATR 525; 90 ATC 4580, in that an employer’s requirement that an employee incur expenditure which is not related to the income-producing activities of that employee, does not convert the expenditure into a deductible outgoing.
To be an allowable deduction the expense must be incurred in earning your assessable income and not be a private or domestic expense.
Conclusion
You are encouraged to obtain weekly therapy for yourself to maintain professional standards in your role as a qualified medical practitioner, due to the nature of your work. The sessions help you to maintain your wellbeing.
This is a private expense and not incurred in the carrying out of your income earning activity of counselling. The expense is not deductible.