Edited version of private advice

Authorisation Number: 1052220383833

Date of advice: 9 February 2024

Ruling

Subject: Work related expenses - meals

Question

Are you able to claim the cost of meals consumed while travelling to and from your place of work?

Answer

No.

This ruling applies for the following period:

Year ended 30 June 20XX

The scheme commenced on:

1 July 20XX

Relevant facts and circumstances

You lived in Town 1.

You were employed by Employer Z.

The work site was located near Town 2.

You worked a number of days on a roster.

Your employer provided accommodation at a hotel in Town 2.

The day before you began your shift you drove from your home to the accommodation in Town 2, which took several hours travel by car.

You were responsible for the purchase of all meals travelling to and from Town 2, as well as those consumed while staying at the hotel.

You were paid a number of allowances by your employer including a meal allowance. The allowances are displayed on your payslip.

Relevant legislative provisions

Income Tax Assessment Act 1997 section 8-1

Reasons for decision

Section 8-1 of the Income Tax Assessment Act 1997 (ITAA 1997) allows a deduction for all losses and outgoings to the extent to which they are incurred in gaining or producing assessable income except where the outgoings are of a capital, private or domestic nature, or relate to the earning of exempt income.

Taxation Ruling TR 2021/4 Income tax and fringe benefits tax: employees: accommodation and food and drink expenses, travel allowances, and living-away-from-home allowances (TR 2021/4) considers the deductibility of accommodation and food.

Paragraphs 14 to 15 of TR 2021/4 state:

14. Living expenses are a prerequisite to gaining or producing an employee's assessable income and are not incurred in performing an employee's income-producing activities. Living expenses are also private or domestic in nature. This means that even if these expenses were incurred in gaining or producing assessable income, they still would not be deductible due to the application of paragraph 8-1(2)(b).

15. While living expenses must be incurred before any assessable income can be derived, a loss or outgoing is not incurred in gaining or producing an employee's assessable income merely because it is necessary. This is particularly relevant to living expenses. A person must eat and sleep somewhere, whether or not they engage in employment.

Furthermore, paragraphs 25 to 27 of TR 2021/4 state:

25. An employee cannot deduct accommodation and food and drink expenses they have incurred where, due to their personal circumstances, they live far away from where they gain or produce their assessable income.[35] These expenses are living expenses and are not deductible.

26. In these circumstances, the expenses are incurred because the employee's personal circumstances are such that they keep their usual residence, rather than relocate. The occasion of the outgoing for accommodation and food and drink is not found in the employee's income-producing activities, meaning that these expenses are not incurred in the course of gaining or producing the employee's assessable income. They are private and domestic in nature.

27. This also applies where an employee regularly works at a particular location for one or more days each week. A particular location where an employee works regularly is a regular place of work.

Therefore, accommodation and meal expenses incurred while working away from home are essentially living expenses of a private or domestic nature and therefore are not deductible.

In this case, your meals during the normal course of your day including breakfast and lunch are considered to be private expenses for which you cannot claim a deduction. This position does not change if you are required to purchase food or drink whilst you are away from your usual place of residence or on a jobsite.

Therefore, in your case the cost of meals is considered to be a private expense and not deductible under section 8-1 of the ITAA 1997.