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Edited version of your written advice
Authorisation Number: 1051448936800
Date of advice: 2 November 2018
Ruling
Subject: Work related travel
Question
Can a portion of a vehicle trip from work to home and home to work be included in the vehicle logbook as business related?
Answer
No.
This ruling applies for the following period
Year ending 30 June 20XX
Year ending 30 June 20XX
The scheme commenced on
1 July 20XX
Relevant facts
A vehicle is owned by the company and provided to the director.
The company operates out of two locations.
The company schedules telephone meetings for the director to occur on the director trips from home to work and work to home.
The average trip for the director from home to work and work to home is XX minutes.
The director keeps a detailed log book of travel and telephone meetings that occur during travel.
These records detail the telephone meeting in minutes not distance travelled.
The meetings do not occur daily.
The director is not required to break journey to carry out telephone meetings.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 8-1
Income Tax Assessment Act 1997 section 51(1)
Reasons for decision
Section 8-1 of the Income Tax Assessment Act 1997 (ITAA 1997) provides that a deduction for all losses and outgoings are allowable to the extent to which they are incurred in gaining or producing assessable income; except where the expenses incurred are capital or private in nature, or relate to the earning of exempt income.
Home to work travel
Expenses for travel between a taxpayer’s home and their workplace are generally considered to be a private expense that is necessarily incurred to allow a taxpayer to be able to get to their place of work.
The Commissioners views on the deductibility of travel expenses between a taxpayer’s place of residence and their place of employment or business are expressed in Taxation Ruling IT 112, which discusses various court decisions and affirms the view that home to work travel, in most cases, is a private expense.
The reason for the home to work travel must be established in order to determine whether a deduction for the travel will be allowed. It must be clearly identified that a taxpayer is travelling on work, and not to work for a deduction to be allowed.
In your case, the director has a lengthy distance to travel from home to work and work to home daily. Therefore it is considered that the telephone meetings are scheduled to occur at this time as a matter of convenience for the director, the calls are incidental to the travel and the director is not travelling on work.
Therefore a deduction for a portion of the travel for the director from home to work and work to home is not an allowable business deduction as per section 8-1 of the ITAA 1997 as the expenses incurred are considered to be private expenses.