Edited version of private advice

Authorisation Number: 1052401895812

Date of advice: 28 May 2025

Ruling

Subject: Deductions - therapy dog - restaurant meals

Question 1

Are the costs associated with an emotional support dog, including food and other related expenses deductible under section 8-1 of the Income Tax Assessment Act 1997 (ITAA 1997)?

Answer

No.

Question 2

Are expenses incurred in purchasing groceries and ingredients for professional research and cooking deductible under section 8-1 of the ITAA 1997?

Answer

No.

Question 3

Are expenses incurred at restaurants for documented research on industry trends and culinary techniques deductible under section 8-1 of the ITAA 1997?

Answer

No.

This ruling applies for the following periods:

Year ended XX June 20XX

Year ended XX June 20XX

Year ended XX June 20XX

The scheme commenced on:

X July 20XX

Relevant facts and circumstances

You are employed as a culinary trainer.

You operate a consultancy business as a sole trader.

As a culinary professional you frequently purchase groceries and ingredients to cook and conduct research to assist with your employment as a culinary trainer and your consultancy.

You dine at various restaurants to evaluate food quality and industry trends to support your culinary training and consulting work.

You suffer from psychological disorders.

A medical professional recommended an emotional support animal.

You purchased an emotional support dog in the year ended June 20XX.

Relevant legislative provisions

Income Tax Assessment Act 1997 section 8-1.

Reasons for decision

Under section 8-1 of the ITAA 1997 you are entitled to a deduction to the extent an expense is incurred in producing your assessable income. However, you are not entitled to a deduction if the loss or outgoing is capital, private or domestic in nature.

To be deductible under section 8-1 of the ITAA 1997, expenditure must have the essential character of an outgoing incurred in gaining assessable income. There must be a nexus between the outgoing and the assessable income so that the outgoing is incidental and relevant to the gaining of assessable income, and the expenditure must not be capital, private or domestic in nature.

Emotional support dog

Generally, the costs to maintain and train animals are a private expense and not tax deductible. There are limited circumstances in which a deduction for the purchase, training and care of a dog can be claimed. These involve a finding that the dog performs an integral part of the income producing activity an contributes to the production of that income. For example, where the dog is trained as a mustering dog, guard dog, sniffer dog or police dog and it is used in such a capacity, they perform an identifiable function in a business operated by their owner.

Where the dog's owner is an employee a deduction can only be determined by reference to whether the cost of maintaining the dog has the necessary connection with earning of the employee's salary or wages.

Taxation Ruling (TR) 2022/1 Income tax: effective life of depreciating assets (applicable from 1 July 2022) considers all assets that an individual can depreciate in the course of earning assessable income where the nexus between the outgoing and the income can be connected. Working dogs (including certified therapy dogs used by a qualified therapist) are listed as a depreciating asset. However, the definition of a working dog in the TR 2022/1 also outlines that assistance dogs (including support dogs) are excluded and are not considered to be working.

In your case, you will take your dog to work where it will assist you with managing the symptoms you suffer as a result of your psychological disorders. However, the dog will not be assisting you in directly performing your duties, that is the dog will not perform an integral part of the income producing activity and contribute to the production of your income.

In your circumstances, the costs associated with your emotional support dog are not incurred in earning your assessable income. Therefore, the expenses are not deductible under section 8-1 of the ITAA 1997.

Groceries, ingredients and restaurant meals

In most circumstances the cost of dining at a restaurant would be considered a private expense. In some limited circumstances this expense may be characterised as an income producing expense and may be an allowable deduction. However, there is an onus on the taxpayer to prove that such an outlay should be an allowable deduction.

This was highlighted in Case P30 25 CTBR (NS); Case 94 82 ATC 139 when the Board of Review disallowed a claim for the purchase of newspapers by a real estate salesman. The real estate salesperson would gather information from the daily papers to assist him in selling real estate. The salesperson was, however, unable to demonstrate that his income was affected by expenditure on the newspapers. The expense retained its private character, and the deduction was not allowed.

In Federal Commissioner of Taxation v. Cooper (1991) 29 FCR 177; 91 ATC 4396; (1991) 21 ATR 1616, a professional footballer was denied the cost of buying additional food and drink that his coach had instructed that he consume to maintain his weight during the football season. Justice Hill said:

Food and drink are ordinarily private matters, and the essential character of expenditure on food and drink will ordinarily be private rather than having the character of a working or business expense.... the fact that the employee is required, as a term of employment, to incur a particular expenditure does not convert expenditure ... into a deductible outgoing.

In your case, it is acknowledged that you may obtain ideas and knowledge while dining in restaurants and practicing your cooking skills. However, the expenses are not necessarily incurred in earning your assessable income. The expenditure incurred has the character of a private expense. The connection is too general or remote to allow a deduction for any portion of the cost.

Accordingly, you are not entitled to a deduction under section 8-1 of the ITAA 1997 for expenditure incurred in dining in restaurants to evaluate food quality and industry trends and purchasing ingredients to cook and conduct research.