Edited version of private advice

Authorisation Number: 1051613222342

Date of advice: 7 January 2020

Ruling

Subject: Work related expenses

Question

Are you entitled to claim a deduction for wages and superannuation paid to your spouse for services and assistance required in the course of your employment as a Non-Residential Valuation Manager?

Answer

Yes.

It is accepted that the expenses incurred when engaging the services of your spouse to assist in performing your duties and generating further commission income are in direct connection to your income producing activities as per section 8-1 of the Income Tax Assessment Act 1997 (ITAA 1997).

This ruling applies for the following period:

1 July 2019

The scheme commences on:

Year ending 30 June 2020

Relevant facts and circumstances

This ruling is based on the facts stated in the description of the scheme that is set out below. If your circumstances are materially different from these facts, this ruling has no effect and you cannot rely on it. The fact sheet has more information about relying on your private ruling.

You are a Certified Practising Valuer employed as Non-Residential Valuation Manager.

You will receive a small base salary of $XXXX per annum.

In addition to your base salary, you are entitled to receive bonuses. These bonuses are for fee writing responsibilities where your bonus is calculated as X% of the fees written and banked.

Your bonus is paid monthly.

Your role requires you to travel extensively and accordingly you require assistance in order to perform your duties at the desired level in order to receive the additional bonuses.

You have employed your spouse to assist in performing your duties and generating further bonus income.

Your employer is aware that you have engaged the support services of your spouse.

Your spouse has experience in your industry due to previous roles as a valuer assistant and systems business analyst.

Based on previous sales history you expect your fee writing bonus will exceed and have provided evidence that this has occurred since your spouse begun to assist you.

You will pay your spouse $XX an hour, including superannuation, for a minimum of XX hours X days a week. These hours may increase according to workloads.

The functions your spouse will perform in their role as an employee are split as follows:

Property Research

·        Assist with property research in relation to specialised going concern valuations such as motels, hotels, caravan parks, service stations, child care centres and marinas.

·        Assist with property research in relation to larger mainstream commercial and rural valuation reports. These reports may include specialised 'fair value' reporting for Government bodies.

·        Research includes current property sector statistics including Government publications and tourism bodies, etc.

·        Assist in updating any sales data from valuations that you have carried out and ensure they are correctly

·        Statistical analysis of population and demographic data where relevant to the valuation such as catchments for child care centres and shopping centres.

·        Analysis of traffic data from government departments in relation to service station properties.

·        Keep competition analysis up to date for relevant asset classes.

·        Field Work

·        Attend larger valuation inspections to assist with photographs, data capture, etc.

·        Valuation Reporting

·        Set up the frame work for all valuation reports and insert land maps, title search details and annexures.

·        Input and analysis of financial trading information into financial calculation models.

·        Word processing ('verbal' dictation by spouse) of all valuation reports noting a typical full valuation report is a XX-XX page document excluding annexures.

·        Importing financial tables and graphs into valuation reports.

·        Final report formatting in accordance with employer policy, inserting photographs and spell check.

Report Finalisation

·        All administration/clerical duties for job finalisation including document uploads, disbursement of expenses and invoicing in required systems.

·        Other Tasks & Duties

·        Travel bookings.

·        Processing of credit card expenses/disbursements to spouses employment.

·        Ad hoc clerical duties.

Relevant legislative provisions

Income Tax Assessment Act 1997 section 8-1