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Edited version of your written advice
Authorisation Number: 1051413898848
Date of advice: 10 August 2018
Ruling
Subject: Income tax - deductions - legal expenses
Question
Can you claim a deduction for legal expenses incurred in pursuing a workers compensation payment for lost earnings.
Answer
Yes
Having considered your circumstances, you are entitled to a deduction under section 8-1 of the Income Tax Assessment Act 1997.
This ruling applies for the following period:
Financial ended 30 June 2018
The scheme commences on:
1 July 2017
Relevant facts and circumstances
You were initially denied workers compensation by the insurance company.
You engaged a lawyer to take legal action against the insurance company to pursue your workers compensation claim for lost wages at the employment tribunal.
Your claim was subsequently accepted as a result of the legal action.
Your income for the financial year ended 30 June 20XX includes the workers compensation claim you pursued.
You incurred legal costs in pursuing your entitlement to workers compensation payments for lost wages.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 8-1