Private ruling: Work-related expenses
Date of advice: 2 November 2016
Published: February 2017
Ruling period: Year ended 30 June 2016
Date scheme commenced: 1 July 20XX

Ruling: Q1: Are you entitled to claim a deduction for the cost of attending overseas and domestic conferences directly related to your employment? | A1: Yes | Q2: Are you entitled to claim a deduction for the cost of attending theatre performances and tourist attractions? | A2: No

Relevant facts and circumstances: You are employed as a lecturer and Head of a Department at a University. You incurred expenses on airfares, accommodation, taxis and transfers while travelling between various overseas countries and home to Australia. In the Country A you attended performances and tourist attractions. You attended conferences and workshops related to your teaching role in various overseas countries including Australia You also had X other days of non-work related travel during your time away.

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

Reasons for decision: Summary: TR 95/20 details the deductions available to employed performing artists. Paragraph 172 of TR 95/20 states that a deduction is allowable for the costs of attendance at theatre or film performances if the performances have a content specifically related to a performing artist's current work. Costs associated with attendance at performances for general interest or entertainment or other private purposes are not an allowable deduction. It is not considered that there is a nexus between your employment and your expenditure on theatre performances and a visit to various tourist attractions. You were not required by your employer to attend either of these, and it would not be considered that these attendances would result in increased income or increased skill in your employment.

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 to the extent to which they are of a capital, private or domestic nature. | Taxation Ruling TR 95/14 details the deductions that may be available to employee teachers. | Although you are a university lecturer and head of department, the same principles can be applied to your situation. | Taxation Ruling TR 98/9 discusses the deductibility of self-education expenses. Paragraph 13 of TR 98/9 states: | If a taxpayer's income-earning activities are based on the exercise of a skill or some specific knowledge and the subject of self-education enables the taxpayer to maintain or improve that skill or knowledge, the self-education expenses are allowable as a deduction. | Thus, self-education expenses incurred by a taxpayer will qualify for deduction under section 8-1 of the ITAA 1997, if there is a sufficient nexus to the production of assessable income and the improvement of a skill or some specific knowledge. | Paragraph 23 of TR 98/9 states that subject to the general tests under section 8-1 of the ITAA 1997 being met, the following types of expenses relating to approved self-education are allowable deductions; | ● course or tuition fees of attending educational institutions, conferences or seminars | ● the cost of professional and trade journals, text books and stationery | ● airfares incurred on overseas study tours, on work-related conferences or seminars, or attending educational institutions | ● where a taxpayer is away from home overnight or temporarily, accommodation and meal expenses incurred on overseas study tours, conferences or seminars, or attending an educational institution | In your case, you flew from Australia to an overseas location. Here you attended theatre performances and tourist attractions. You subsequently travelled to conferences in other overseas countries, then back to Australia where you went straight to another conference. You then travelled home. | You have stated that there were X days of private travel which have not been included in this itinerary. | It must now be determined whether the expenses incurred are of a capital, private or domestic nature. | You have incurred airfare expenses in travelling to foreign countries and within Australia. As far as these expenses were incurred in undertaking the self-education, you entitled to a deduction for these costs under section 8-1 of the ITAA 1997. However only the proportion of the travel relating to the self education expenses is deductible. The apportionment can be made on a “days” basis (total days spent in self education/ total days away from home). | Paragraph 89 of TR 98/9 states that where a taxpayer is away from home overnight in connection with a self-education activity, accommodation and meals expenses incurred are deductible under section 8-1. (Examples include an overseas study tour or sabbatical, a work-related conference or seminar or attending an educational institution.) They are part of the necessary cost of participating in the tour or attending the conference, the seminar or the educational institution. The expenditure is not considered to be of a private nature because its occasion is the taxpayer's travel away from home on income-producing activities.