Private ruling: Work related expenses
Published: January 2014
Ruling period: Year ended 30 June 2008 | Year ended 30 June 2009 | Year ended 30 June 2010 | Year ended 30 June 2011 | Year ended 30 June 2012 | Year ended 30 June 2013
Date scheme commenced: 1 July 2007

Ruling: Q1: Are you entitled to a deduction for meals when you sleep over at your workplace? | A1: No

Relevant facts and circumstances: You are a carer. You are required to sleepover at your work place on average, one night per week and you are paid a sleepover allowance.

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

Reasons for decision: Summary: Section 8-1 of the 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. The payment of an allowance does not automatically entitle the taxpayer to a deduction. The expense must be incurred in the course of producing assessable income ( Amalgamated Zinc (De Bavay's) Ltd v. FCT (1935) 54 CLR 295; (1935) 3 ATD 288; [1936] ALR 67). A sleepover allowance is paid as compensation for the additional expenses and inconveniences the taxpayer suffers as a result of occasionally spending the night at their place of employment. A sleepover allowance is a payment in the nature of salary and wages and is included in assessable income. A sleepover allowance is not a living-away-from-home allowance because the recipient is not considered to be living away from their usual place of residence within the meaning of subsection 30(1) of the Fringe Benefits Tax Assessment Act 1986 . A person will not be regarded as living away from home if their work location does not change or if they merely spend a night, or a few nights, away from their usual place of residence because of work. Nor can the sleepover allowance be considered to be a travel allowance as the duties performed as part of the taxpayer's employment continue to be conducted at the same site. Expenditure on the daily necessities of life, for example food and drink, are generally not deductible, unless the outgoing gives the expenditure the essential character of a working expense, as it is not incurred in gaining or producing assessable income and is also private or domestic in nature. In your case, when you sleepover at your client's residence, you are merely performing your normal duties and you are permitted to sleep when your assistance is not required. As stated above, the sleepover allowance is not considered to be a travel allowance and it is not considered that you are travelling away from home overnight for work. Therefore, you are not entitled to a deduction for meals and incidentals.