| Disclaimer You cannot rely on this record in your tax affairs. It is not binding and provides you with no protection (including from any underpaid tax, penalty or interest). In addition, this record is not an authority for the purposes of establishing a reasonably arguable position for you to apply to your own circumstances. For more information on the status of edited versions of private advice and reasons we publish them, see PS LA 2008/4. |
Edited version of private advice
Authorisation Number: 1051775152898
Date of advice: 2 November 2020
Ruling
Subject: Legal expenses
Question
Are the legal expenses you incurred deductible under section 8-1 ofthe Income Tax Assessment Act 1997 (ITAA 1997)?
Answer
Yes. The Commissioner considers that your situation is similar to theATO ID 2001/27 Income Tax Deductions and expenses: Legal expenses in course of employment.
ATO ID 2001/27references Commissioner of Taxation v Day [2008] HCA 53, 2008 ATC 20-064, (2008) 70 ATR 14 (Day's case) where the courts accepted that legal expenses incurred in defending the manner in which a taxpayer performed his employment duties were allowable.
Your case is similar to ATO ID 2001/27 and Day's case as you incurred legal expenses defending the manner in which you performed your employment duties.
This ruling applies for the following periods:
Year ended 30 June 20XX
Year ended 30 June 20XX
The scheme commences on:
1 July 20XX
Relevant facts and circumstances
You were employed as a corrections officer by the Department of Justice.
You were involved in an incident at your workplace with an inmate.
A complaint was filed by the inmate and you subsequently charged with common assault and abuse of office.
You engaged legal representation to defend the manner in which you performed your employment duties.
You incurred legal expenses.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 8-1