Edited version of private advice

Authorisation Number: 1052050109636

Date of advice: 8 November 2022

Ruling

Subject: Work-related transport expenses

Question

Can you deduct transport expenses incurred in travelling between your home and worksites under section 8-1 of the Income Tax Assessment Act 1997 (ITAA 1997)?

Answer

Yes. For expenses to be deductible under section 8-1 of the ITAA 1997 they must be incurred in gaining or producing assessable income.

Ordinarily, expenses incurred for travel between home and a place of work are not deductible as they are private in nature. However, taxation ruling TR 2021/1 Income tax: when are deductions allowed for employees' transport expenses? illustrates a number of situations where the nature of the travel is considered to be an essential part of the employment duties and are therefore deductible under section 8-1 of the ITAA 1997.

Paragraph 70 of TR 2021/1 confirms that when an employee is required to commence work at home and then travel to another place of work to complete their duties the travel is characterised as part of the employment and the associated expenses are therefore deductible under section 8-1 of the ITAA 1997.

You are required to prepare for your work assignments from home before departing to the first site of the day to complete the assignment, therefore expenses incurred in travelling between your home and worksites are deductible under section 8-1 of the ITAA 1997.

This ruling applies for the following periods:

Year ended 30 June 20XX

Year ended 30 June 20XX

Year ended 30 June 20XX

The scheme commences on:

1 July 20XX

Relevant facts and circumstances

You are employed in a technical role.

You are required to travel to XX different work locations to perform your employment duties.

You work on a roster.

When you are on roster you are required to be on call 24 hours a day to travel to any location required.

You do not have a specific location to which you return before or after completing a job.

The distance between the two outermost work locations is over 100 kilometres.

Your job requires you to work from home planning each assignment before completing the job onsite. This is stipulated in your employment contract.

You allow an hour for planning for each assignment.

You spend a further hour per day performing other tasks from home such as replying to work related correspondence and contributing to policy and system development.

Your use your own car for all travel.

You receive travel allowance which is included in your ordinary time earnings.

You have stated that you are not directly reimbursed for travel costs by your employer.

Relevant legislative provisions

Income Tax Assessment Act 1997 section 8-1