Private ruling: Legal expenses defending against a complaint at work
Date of advice: 28 June 2019
Published: September 2019
Ruling period: Year ended 30 June 2018
Date scheme commenced: 1 July 2017

Ruling: Q1: Are the legal expenses you incurred deductible? | A1: Yes Based on the facts it is considered that the legal expenses you incurred are deductible under section 8-1 of the Income Tax Assessment Act 1997 .

Relevant facts and circumstances: You are employed. You had trouble with a fellow employee who you managed and their friend. The friend had lodged a formal complaint against you. The complaint stated that you engaged in behaviour in your role that does not meet the organisation's Code of Conduct. You incurred legal expenses in defending yourself against this complaint. Eventually the complaint was dismissed and no findings were made against you.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 8-1