Private ruling: Work related travel expenses
Published: August 2013
Ruling period: Year ended 30 June 2013
Date scheme commenced: 1 July 2012

Ruling: Q1: Are you entitled to a deduction for any part of the costs associated with your overseas trip? | A1: No.

Relevant facts and circumstances: You are a secondary school teacher. You travelled overseas and visited many historical sites and geographical features. You contend that the travel and visits directly relate to the State Board of Studies syllabus that you teach.

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

Reasons for decision: Summary: 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 98/9 states self-education expenses are allowable as a deduction if your current income-earning activities are based on the exercise of a skill or some specific knowledge and the subject of the self-education enables you to maintain or improve that skill or knowledge. However, if the subject of the self-education is too general in terms of your income-earning activities, the necessary connection between the self-education expense and the income-earning activity does not exist. In Case U109 87 ATC 657, the taxpayer was a science teacher who specialised in geology and was the head of the school science department. He undertook a 17 day trip to Indonesia organised by a natural museum history society of which he was a member. During the course of the trip he visited several volcanoes and other geological sites, and attended a geological congress. He also visited some tourist attractions. The taxpayer took many slides of the geological sites and prepared a taped commentary which he used in his teaching on his return. The Administrative Appeals Tribunal (AAT) examined previous court decisions dealing with teachers who had claimed for the cost of overseas travel. It concluded that although the taxpayer may have been a better teacher because of the travel, this fell short of the sufficient connection required between the travel and their income earning activities. The AAT stated that some taxpayers are fortunate in finding personal and recreational satisfaction in their field of endeavour and that in this case the trip was recreational in character and not deductible. In your case, you have travelled to several overseas destinations and visited many historically and geographically significant locations. Although this trip may broaden your teaching skills and knowledge, these reasons alone are not enough to demonstrate a sufficient connection between the travel and your income producing activities. The expenses for the travel and visits may directly relate to the State Board of Studies syllabus that you teach, and will arguably make you a better teacher, but the knowledge or skills that you will gain from the trip will be too general in nature for the expenses to be incurred in the course of gaining your assessable income as a secondary teacher. Therefore your trip is not considered to have a sufficient connection to your employment duties, and you are not entitled to a deduction for expenses incurred in your overseas travel.