Private ruling: Legal fee expenses
Date of advice: 13 November 2018
Published: March 2019
Ruling period: Year ending 30 June 2018
Date scheme commenced: 1 July 2017

Ruling: Q1: Are you entitled to a deduction for legal expenses incurred in a misconduct investigation? | A1: Yes. It is accepted that you incurred the legal fees in defending the nature in which you perform your employment duties.

Relevant facts and circumstances: ● You are employed in a management role. ● You were accused of bullying an employee. ● A misconduct investigation commenced. ● Your employer demanded you reply to the allegations and defend yourself or face dismissal. ● You sought legal advice. ● The lawyers reviewed and responded to the allegations. ● All accusations were eventually withdrawn, with no further case to answer. ● You were then able to continue your employment with your employer.

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